Compugen Ltd. Ordinary Shares (CGEN)

FairStock Score: 95/100 — HIGH CONVICTION

Key Financials

Strengths

• Generates $24 million in annual free cash flow (8.7% yield on market cap)
• High return on equity of 44.8% demonstrating efficient capital deployment
• Conservative balance sheet with debt-to-equity of just 0.03, providing financial flexibility
• Superior net profit margin of 78.1% indicating pricing power and operational efficiency
• Revenue growth of 4477.3% demonstrates strong top-line momentum

Concerns

• Altman Z-Score of 1.6 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

Compugen Ltd. Ordinary Shares is a micro-cap healthcare company valued at $280 million. The business generates $73 million in annual revenue with a 78.1% net margin and $24 million in free cash flow. From a quality standpoint, Compugen shows solid Piotroski F-Score of 6/9 and distressed Altman Z-Score of 1.6 warrants caution. On valuation, the stock is deeply undervalued on a P/E basis at 7.7x, with a modest 3% margin of safety vs Graham Number. Growth dynamics show revenue growing at 4477.3% and profit growth of 1029.3%. Our composite FairStock Score of 95/100 reflects strong fundamentals overall. This combination of reasonable valuation, solid returns, and conservative leverage makes it worth a closer look for value-oriented portfolios.

Bull Case

Compugen's 4477% revenue growth trajectory could accelerate as it captures additional market share in the healthcare sector. With $24 million in annual free cash flow (8.7% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

Macro headwinds or sector-specific disruption could pressure margins, particularly if competitive intensity increases in the healthcare space. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer