Company Overview
Universe Pharmaceuticals INC operates within the healthcare sector, specifically functioning in the drug manufacturing industry focused on specialty and generic pharmaceuticals. The company engages in the manufacturing, marketing, distribution, and sales of traditional Chinese medicine derivative products designed for the treatment and relief of common chronic health conditions in the elderly market. This operational scope defines its position as a niche player targeting specific demographic health needs through specialized pharmaceutical formulations. The company maintains a relatively small market capitalization of $1.54M and reported annual revenue of $17.86M while employing a workforce of 216 individuals. These financial metrics indicate that Universe Pharmaceuticals INC is a micro-cap entity with limited scale, suggesting it operates with a constrained resource base and potentially high sensitivity to market fluctuations compared to larger peers in the pharmaceutical sector.
Financial Health
The company reported a trailing twelve-month revenue of $17.86M alongside a net income loss of $-3,672,055 and an EBITDA of $-2,398,488. The significant disparity between the positive revenue figure and the substantial negative net income reveals a cost structure where operating expenses and other deductions heavily outweigh gross profits, resulting in a bottom-line deficit despite sales activity. Free cash flow stands at $-10,243,885, indicating a pronounced burn rate that limits the company's immediate financial flexibility for capital expenditures or unexpected liabilities without external financing. The company reports a gross margin of 35.3%, which suggests a reasonable ability to cover the direct costs of producing its traditional Chinese medicine derivatives before accounting for overhead. However, the operating margin of -6.8% and a profit margin of -20.6% demonstrate that overhead costs and non-operating expenses are eroding profitability at a significant rate relative to sales volume. In terms of leverage, the company holds $33.59M in cash against $9.26M in debt, supported by a debt-to-equity ratio of 16.49, which indicates a conservative balance sheet position where liquid assets significantly exceed debt obligations despite the negative earnings. Liquidity is further supported by a current ratio of 4.07, signaling a strong capacity to meet short-term obligations with its current assets. Return on equity is recorded at -7.2% and return on assets at -2.7%, metrics that collectively reveal that management effectiveness is currently challenged by losses that dilute shareholder value and utilize assets inefficiently in generating profit.
Valuation Assessment
Trailing P/E and forward P/E ratios are listed as N/A due to the company's negative earnings, which implies that traditional earnings-based valuation multiples cannot be calculated or are not meaningful in the current context. The price-to-book ratio is 0.03, indicating that the market values the company's equity at a fraction of its book value, reflecting a deep discount or high perceived risk rather than a standard market premium. The price-to-sales ratio of 0.09 and an EV/EBITDA of 9.51 provide alternative valuation perspectives, suggesting the stock trades at a very low multiple of its sales revenue and enterprise value relative to earnings power. The 52-week high is $11.00 and the 52-week low is $2.00, establishing a wide trading range that highlights the asset's volatility; without a specific current price provided in the facts, the valuation context relies on these historical bounds to show potential upside or downside distance. The beta value is 1.57, which signifies that the stock price exhibits significantly higher volatility relative to the broader market, moving more aggressively than the average equity and amplifying both potential gains and losses during market swings.
Growth & Income
Revenue growth year-over-year is -14.1%, while earnings growth is N/A due to the lack of profitable earnings to measure, meaning the company is contracting in terms of sales rather than expanding. Since the earnings growth rate cannot be calculated against revenue growth due to the net loss, the decline in revenue is the primary driver of financial contraction, implying a challenging market environment or product lifecycle issues. The company does not pay dividends, evidenced by a dividend yield of N/A and a payout ratio of 0.0%, which means all available earnings are retained or, in this case, insufficient to cover losses, forcing the company to rely on cash reserves for operations. Consequently, the overall growth and income profile is characterized by negative revenue expansion and no income distribution to shareholders, focusing entirely on survival and operational restructuring rather than shareholder returns or organic growth.