Value
4.4/10data confidence 67%| Component | Sub-score |
|---|---|
| P/S | 0.0 |
| Fwd P/E | 3.0 |
| PEG | 10.0 |
| Analyst target | 9.0 |
- ▸Forward P/E: 35.6x
- ▸PEG: 0.24
ZYME · Why this verdict
Why Zymeworks (ZYME) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.2/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Zymeworks is a clinical-stage biotech concentrated in a single drug (zanidatamab, sold as Ziihera) and a single counterparty (Jazz Pharmaceuticals), with a quality score below investment thresholds and recent earnings misses including a -484% surprise — but analyst consensus targets 47% upside based on the commercial launch trajectory of zanidatamab.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Zymeworks derives its commercial thesis almost entirely from zanidatamab (Ziihera) and its partnership with Jazz Pharmaceuticals — a dual concentration risk where a clinical setback, partnership dispute, or Jazz strategic change could eliminate the majority of the company's near-term revenue potential. Bear case | Zymeworks discloses at least one additional late-stage program outside of zanidatamab within 12 months, reducing single-drug concentration risk. | →Stable |
| CounterConcentrated focus on a single commercialized asset is common and arguably appropriate for a company this size; success with zanidatamab would generate the capital needed to build out the pipeline. | ||
Zymeworks missed earnings estimates by -484% in May 2026 and -70.6% in March 2026, with free cash flow at -56% of revenue — indicating that commercial launch expenses for zanidatamab are substantially higher than analysts modeled and cash burn is accelerating. Earnings | Average quarterly EPS surprise improves to better than -30% within 2 quarters as commercialization spending stabilizes. | →Stable |
| CounterTwo prior beats — including a +106% surprise in August 2025 — show that the company can outperform when the commercialization timeline aligns with analyst models; the recent misses may reflect launch timing differences. | ||
The company's quality score of 2.2 falls below the 4.0 minimum investment threshold, with cash burning at -56% of revenue, no return on assets, and a Piotroski F-Score of 4.4/9 — reflecting early-stage commercial status where the business has not yet proven it can generate positive returns. Warnings | Quality score rises above 4.0 within 18 months as zanidatamab revenues scale and cash burn as a percentage of revenue improves above -20%. | →Stable |
| CounterA current ratio of 5 indicates Zymeworks holds sufficient cash to fund operations through the critical zanidatamab launch phase without dilutive financing; the quality score may improve rapidly once commercial revenues scale. | ||
Analysts target a 47% price gain to $34.13 from the current $23.26, reflecting confidence in the zanidatamab commercial launch trajectory, with a PEG ratio of 0.23 suggesting the stock is inexpensive relative to projected earnings growth if the launch succeeds. Targets | Price rises above $30 within 12 months, increasing by more than 29% from the current $23.26, as zanidatamab sales data demonstrates commercial traction. | →Stable |
| CounterAn average quarterly EPS surprise of -108% in the most recent 4 quarters signals the market's optimistic launch assumptions are consistently wrong; the 47% analyst upside may reflect targets that haven't been adjusted for the actual commercial ramp pace. | ||
Zymeworks derives its commercial thesis almost entirely from zanidatamab (Ziihera) and its partnership with Jazz Pharmaceuticals — a dual concentration risk where a clinical setback, partnership dispute, or Jazz strategic change could eliminate the majority of the company's near-term revenue potential.
→StableBear case
- Expectation
- Zymeworks discloses at least one additional late-stage program outside of zanidatamab within 12 months, reducing single-drug concentration risk.
CounterConcentrated focus on a single commercialized asset is common and arguably appropriate for a company this size; success with zanidatamab would generate the capital needed to build out the pipeline.
Zymeworks missed earnings estimates by -484% in May 2026 and -70.6% in March 2026, with free cash flow at -56% of revenue — indicating that commercial launch expenses for zanidatamab are substantially higher than analysts modeled and cash burn is accelerating.
→StableEarnings
- Expectation
- Average quarterly EPS surprise improves to better than -30% within 2 quarters as commercialization spending stabilizes.
CounterTwo prior beats — including a +106% surprise in August 2025 — show that the company can outperform when the commercialization timeline aligns with analyst models; the recent misses may reflect launch timing differences.
The company's quality score of 2.2 falls below the 4.0 minimum investment threshold, with cash burning at -56% of revenue, no return on assets, and a Piotroski F-Score of 4.4/9 — reflecting early-stage commercial status where the business has not yet proven it can generate positive returns.
→StableWarnings
- Expectation
- Quality score rises above 4.0 within 18 months as zanidatamab revenues scale and cash burn as a percentage of revenue improves above -20%.
CounterA current ratio of 5 indicates Zymeworks holds sufficient cash to fund operations through the critical zanidatamab launch phase without dilutive financing; the quality score may improve rapidly once commercial revenues scale.
Analysts target a 47% price gain to $34.13 from the current $23.26, reflecting confidence in the zanidatamab commercial launch trajectory, with a PEG ratio of 0.23 suggesting the stock is inexpensive relative to projected earnings growth if the launch succeeds.
→StableTargets
- Expectation
- Price rises above $30 within 12 months, increasing by more than 29% from the current $23.26, as zanidatamab sales data demonstrates commercial traction.
CounterAn average quarterly EPS surprise of -108% in the most recent 4 quarters signals the market's optimistic launch assumptions are consistently wrong; the 47% analyst upside may reflect targets that haven't been adjusted for the actual commercial ramp pace.
Per-dimension breakdown
Quality
2.2/10data confidence 86%| Component | Sub-score |
|---|---|
| ROE | 0.0 |
| ROA | 0.0 |
| Current ratio | 5.0 |
| FCF quality | 0.0 |
| Moat | 4.0 |
| Piotroski F | 4.4 |
- ▸Cash-burning: FCF -56% of revenue
- ▸No competitive moat
- ▸Quality concerns
Growth
10.0/10data confidence 33%| Component | Sub-score |
|---|---|
| EPS growth | 10.0 |
Momentum
6.5/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 9.8 |
| OBV | 10.0 |
| MA position | 7.0 |
| Volume | 0.0 |
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
7.9/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 8.5 |
| Price target | 9.7 |
| erm sentiment | 5.0 |
- ▸Analyst upside: 60%
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.0 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
1.2/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.9 |
| quality rank | 1.6 |
| growth rank | 0.4 |
Technical
4.3/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 3.1 |
| support resistance | 3.3 |
| 52w position | 6.5 |
Risk (lower is worse)
5.2/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 5.4 |
| days to cover | 3.4 |
| volatility | 3.1 |
| put call | 10.0 |
| implied vol | 0.9 |
| max pain risk | 3.0 |
| beta | 6.5 |
| debt equity | 9.6 |
- ▸High IV: 74%
- ▸Above max pain $18
- ▸Concentration risks: 2 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
3.3/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 3.3 |
| earnings timing | 5.0 |
| surprise avg | 0.0 |
- ▸Earnings concerns: 2B/2M
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCKPassed (7)
- MOMENTUM:6.5>=5.5
- ASYMMETRY:4.1>=1.5
- INSIDER:OK
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:42d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (0)
none
Warning (1)
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
Reward-to-Risk
4.12
Upside
+39.4%
Downside
9.6%
Sizing output
AVOID
SetupRANGE_BOUND — RSI 44 mid-range, Bollinger mid-band
EdgeNO_EDGE — No clear edge identified
SuitabilityAGGRESSIVE — MCap $1.8B<$5B
Investment implication
The L1 gate blocked the positive-verdict path: a hard-floor threshold was breached, so dimensional pillars — including Growth at 10.0 could not lift the engine output above the verdict floor.
The strongest dimensions are Growth at 10.0, Sentiment at 7.9, and Momentum at 6.5; the weakest are Peer rank at 1.2, Quality at 2.2, and Catalyst at 3.3. The V9 engine cleared all gates with 1 warning, producing an asymmetric reward-to-risk of 4.12 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Zymeworks derives its commercial thesis almost entirely from zanidatamab (Ziihera) and its partnership with Jazz Pharmaceuticals — a dual concentration risk where a clinical setback, partnership dispute, or Jazz strategic change could eliminate the majority of the company's near-term revenue potential.
Trip ifZanidatamab revenues fail to grow by more than 10% sequentially for 3 consecutive quarters, or Jazz terminates or materially modifies the commercial agreement.
- P2Zymeworks missed earnings estimates by -484% in May 2026 and -70.6% in March 2026, with free cash flow at -56% of revenue — indicating that commercial launch expenses for zanidatamab are substantially higher than analysts modeled and cash burn is accelerating.
Trip ifAverage EPS surprise falls below -100% for 2 consecutive quarters, indicating cash burn continues to accelerate beyond -56% of revenue.
- P3The company's quality score of 2.2 falls below the 4.0 minimum investment threshold, with cash burning at -56% of revenue, no return on assets, and a Piotroski F-Score of 4.4/9 — reflecting early-stage commercial status where the business has not yet proven it can generate positive returns.
Trip ifCash runway drops below 4 quarters of operating expenses based on the current burn rate, requiring dilutive financing within 12 months.
- P4Analysts target a 47% price gain to $34.13 from the current $23.26, reflecting confidence in the zanidatamab commercial launch trajectory, with a PEG ratio of 0.23 suggesting the stock is inexpensive relative to projected earnings growth if the launch succeeds.
Trip ifAnalyst consensus price target declines below $25, falling more than 27% from the current $34.13.