Last update on 2024-06-06

Moderna (MRNA) - Piotroski F-Score Analysis for Year 2023 (Final Score: 3/9)

Analyzing Moderna's Piotroski F-Score for 2023, revealing a score of 3/9, and providing insights on profitability, liquidity, and operating efficiency.

Short Analysis - Piotroski Score: 3

We're running Moderna (MRNA) against the Piotroski 9-criteria scoring system to assess profitability, liquidity, and operating efficiency:

The Piotroski F-Score is a rating system for evaluating a company's strength by looking at 9 criteria in profitability, liquidity, and operating efficiency. Moderna (MRNA) scored 3 out of 9 on the Piotroski scale. The company's net income and cash flow have significantly turned negative since their peak during the COVID-19 pandemic. Profitability metrics like Return on Assets and Gross Margin have also declined. On the positive side, the current ratio has improved, and the number of outstanding shares has decreased, indicating no dilution.

Insights for Value Investors Seeking Stable Income

Given Moderna's low Piotroski F-Score of 3 out of 9, the company is currently facing financial challenges, especially in profitability and operational efficiency. Though some liquidity metrics are improving, these positives are outweighed by negative trends. Investors may want to approach Moderna with caution, keeping an eye on whether the company can turn its profitability metrics around before considering investment.

For those who are interested in delving deeper into the specifics, the subsequent section provides a comprehensive exploration of the criteria.

Profitability of Moderna (MRNA)

Company has a positive net income?

Net income is the bottom line profit of a company, showing overall profitability.

Moderna's net income in 2023 is -$4,714,000,000. This negative net income means that the company has not been profitable this year and should be assigned 0 points. Historically, Moderna's net income has fluctuated, peaking at $12,202,000,000 in 2021 during the height of the COVID-19 vaccine distribution. The trend since then has been negative, which indicates challenges in maintaining profitability as demand for vaccines stabilizes.

Company has a positive cash flow?

Cash Flow from Operations (CFO) indicates a company's ability to generate cash from its normal business operations.

In 2023, Moderna's cash flow from operations (CFO) was -$3.12 billion, indicating that the company has not generated sufficient cash from its core business activities. Compared to earlier years, especially 2021 where the CFO reached an all-time high of $13.62 billion, this depicts a drastic shift to the negative. This could be a red flag indicating potential operational concerns, and thus, for this criterion, Moderna scores 0 points.

Return on Assets (ROA) are growing?

Change in Return on Assets (ROA) measures the efficiency of a company at generating profits relative to its total assets. If ROA increases, it indicates improving performance.

For Moderna (MRNA), the ROA in 2022 was 0.331, and it declined sharply to -0.2129 in 2023. This represents a decrease in ROA, indicating a drop in the company's efficiency in generating profits from its assets. Hence, this criterion gets 0 points. Comparing this to the industry median ROA, which decreased from 0.6813 in 2022 to 0.4518 in 2023, the whole industry seems to have experienced a downward trend, albeit Moderna's performance declined much more significantiantly. Charting the operating cash flow over the last 20 years reveals significant volatility, underpinning potential reasons for unstable returns.

Operating Cashflow are higher than Netincome?

The criterion examines if a company's operating cash flow is higher than its net income, indicating superior quality of earnings.

For 2023, Moderna's operating cash flow stands at -$3.12 billion, which is indeed higher than its net income of -$4.71 billion. This adds a point to Moderna's score as the operating cash flow is greater than net income despite both figures being negative. This trend signifies that the company's net income may be skewed by non-cash charges or revenue deferrals, which are important quality indicators for earnings. Further, analyzing the last 20 years of data, it's evident that operating cash flow and net income vary significantly year-over-year, especially the years 2020 and 2021 where Moderna saw a tremendous boost due to the pandemic-related vaccine sales. However, the recent decline in 2023 depicts the post-pandemic normalization of their fiscal metrics. From an accruals perspective, Moderna's 2023 figure of -0.1692 suggests a moderate degree of non-cash adjustments affecting their earnings quality, which is less concerning than in prior years.

Liquidity of Moderna (MRNA)

Leverage is declining?

Leverage measures the amount of debt used to finance the assets of a company. High leverage can imply greater financial risk.

For Moderna Inc. (MRNA), the leverage has increased from 0.0388 in 2022 to 0.0661 in 2023. This represents an increase in the company's use of debt relative to its equity. Historically, looking at the leverage data over the past decade, it's evident that Moderna’s leverage peaked in 2019 at 0.0833 before decreasing significantly in subsequent years. However, the recent uptick in leverage could imply that the company might be taking on more debt to finance growth or manage operational costs, which could increase financial risk if not managed properly.

Current Ratio is growing?

Current Ratio is a liquidity ratio that measures a company's ability to pay short-term obligations or those due within one year.

The Current Ratio for Moderna (MRNA) has increased from 2.7282 in 2022 to 3.4245 in 2023. This upward trend indicates an improvement in the company's liquidity position, as it now has more current assets available to cover its short-term liabilities. In comparison to the industry median Current Ratio, which has decreased from 6.3653 in 2022 to 5.7831 in 2023, Moderna’s improved ratio suggests a better liquidity situation relative to its peers. However, it's worth noting that the relatively lower absolute value of Moderna's Current Ratio still trails the industry median. Overall, the increase in Current Ratio earns Moderna 1 point in the Piotroski Analysis for this criterion.

Number of shares not diluted?

Compare the number of outstanding shares over the last two years, and determine whether the number has increased or decreased. This metric helps understand if shareholder dilution occurred.

When examining the outstanding shares of Moderna (MRNA) from 2022 (394 million shares) to 2023 (382 million shares), we observe a decrease in shares by 12 million. This reduction suggests that there has been no dilution over the past year, which is favorable for existing shareholders as their ownership percentages were not diluted. Thus, based on the Piotroski F-Score criterion for change in shares outstanding, Moderna earns 1 point. Reviewing the historical data over the past decade, it's evident that the outstanding shares have significantly fluctuated over time, peaking in 2021 at 403 million and now showing a decreasing trend, which is a promising sign for future earnings per share.

Operating of Moderna (MRNA)

Cross Margin is growing?

Gross Margin measures the proportion of revenue left after incurring the cost of goods sold and is crucial for assessing a company's operational efficiency.

In 2023, Moderna's gross margin was 0.3052, a significant drop from 0.7131 in 2022. This decline clearly signifies a reduction in operational efficiency and indicates an adverse trend, especially given that the industry median was 0.4518 in 2023. Compared to its biotech peers, Moderna's margin is below the industry standard, underscoring competitive pressures or internal challenges. Given these numbers, per Piotroski's criteria, the trend scores 0 points as it's on the decline.

Asset Turnover Ratio is growing?

Change in Asset Turnover assesses the efficiency of a company in utilizing its assets to generate sales. An important metric in evaluating operational efficiency.

In 2023, Moderna (MRNA) reported an Asset Turnover of 0.305, a noticeable decrease from 0.7471 in 2022. This drop indicates a reduction in the company's ability to generate revenues from its assets. Despite the decline from the previous year, it's important to note that the Asset Turnover has still seen significant growth since 2019, where it was a mere 0.0271. Thus, for the Piotroski Analysis, Moderna will score 0 points for this criterion, reflecting a downturn in operational efficiency in the most recent fiscal year.