Syndax Pharmaceuticals, Inc. (NASDAQ:SNDX) is a biopharmaceutical company focused on developing cancer therapies. The company is currently facing challenges in capital efficiency, as indicated by its financial metrics. Syndax's Return on Invested Capital (ROIC) is -70.12%, which is significantly lower than its Weighted Average Cost of Capital (WACC) of 6.53%. This negative ROIC suggests that Syndax is not generating sufficient returns on its invested capital.
The ROIC to WACC ratio for Syndax is -10.74, highlighting that the company's cost of capital exceeds its returns. This is a concerning indicator for investors, as it suggests that the company is not using its capital effectively to generate profits. In comparison, Kura Oncology, Inc. (KURA) also has a negative ROIC of -38.31% and a WACC of 5.76%, resulting in a ROIC to WACC ratio of -6.65. Although Kura's metrics are negative, they are less severe than those of Syndax.
Mersana Therapeutics, Inc. (MRSN) has a ROIC of -112.71% and a WACC of 10.18%, resulting in a ROIC to WACC ratio of -11.08, which is worse than Syndax's ratio. Replimune Group, Inc. (REPL) has a ROIC of -71.09% and a WACC of 7.42%, with a ROIC to WACC ratio of -9.58. This is slightly better than Syndax's ratio but still indicates inefficiency in capital utilization.
In contrast, CytomX Therapeutics, Inc. (CTMX) stands out with a positive ROIC of 30.37% and a WACC of 13.28%, resulting in a ROIC to WACC ratio of 2.29. CytomX's ability to generate returns above its cost of capital highlights its efficient capital management and potential for growth.
