Denali Therapeutics Inc. Common Stock (DNLI)

FairStock Score: 30/100 — RISKY

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I approach Denali as I would any drug developer: the science may be promising, but the accounts must support the price. The company is a 503-employee biotech pursuing treatments for neurodegenerative and lysosomal storage diseases. In fiscal Q2 2026, the quarter ended 2026-06-30, it reported revenue of $3.6 million and a net loss of $127.6 million, or $0.68 per diluted share. For FY2025, filed figures show a net loss of $512.5 million, or $2.97 per share; FY2024 lost $422.8 million, and FY2023 had revenue of $330.5 million but still lost $145.2 million. Those are not the steady, owner-earnings-positive results I prefer. Trailing free cash flow is negative $466.3 million, a FCF yield of -15.9% on the $2.9 billion market cap. The price was $18.40 at the 2026-10-13 close, giving a P/B of 3.52, ROE of -54.93%, and ROCE of -29.15% on FairStock's calculations. The low D/E of 0.05 and Altman Z-Score of 3.00 are mildly reassuring, but a Piotroski F-Score of 1/9 and FairStock Score of 30/100 suggest fragile financial quality. There is no Peter Lynch category because losses occurred in each of the last four years. A moat would come only from approved therapies, patents, or partnerships, which are not yet visible in revenue. Growth is binary and depends on clinical success. At this price, I see speculation, not a Graham margin of safety.

In plain English: Denali Therapeutics is a small biotech with 503 employees working on new medicines for brain diseases and rare storage disorders. The business is not yet profitable: in fiscal Q2 2026, the quarter ended 2026-06-30, it had $3.6 million of revenue and a net loss of $127.6 million, and it is using a lot of cash. At the $18.40 close on 2026-10-13, the price looks speculative rather than cheap against those current numbers.

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Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-06-30) · fiscal Q1 2026 10-Q (period ended 2026-03-31) · fiscal Q3 2025 10-Q (period ended 2025-09-30) · fiscal Q2 2025 10-Q (period ended 2025-06-30) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer