Eton Pharmaceuticals Inc. Common Stock (ETON)

FairStock Score: 50/100 — MIXED

Key Financials

AI Analysis

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

I approach Eton as a Graham-style skeptic: a small rare-disease drug company with a promising recent turn but no long earnings history. The business is lean—44 employees—and its commercial portfolio targets niche conditions, which can support pricing and specialist demand. The latest filed quarter, fiscal Q2 2026 (quarter ended 2026-06-30), showed revenue of $37.6M and net income of $11.6M, a 30.8% margin, versus revenue of $18.9M and a net loss of $2.6M in fiscal Q2 2025 (quarter ended 2025-06-30). For the full years, revenue rose from $31.6M in fiscal year 2023 (period ended 2023-12-31) to $39.0M in fiscal year 2024 (period ended 2024-12-31) to $80.0M in fiscal year 2025 (period ended 2025-12-31), yet fiscal year 2025 still produced a net loss of $4.6M, following losses of $936,000 in fiscal year 2023 and $3.8M in fiscal year 2024. That is a growth story, not yet a proven compounding machine. FairStock's Lynch category is 'none' because of losses in each of the last four years. Financial health has improved: Piotroski F-Score is 7/9, Altman Z-Score is 12.94, and debt/equity is 0.63. But trailing free cash flow is negative $268,000. The valuation leaves no room for error: at the 2026-10-13 close of $53.33, FairStock calculates a P/E of 136.74, P/B of 32.32, EV/EBITDA of 73.21, and a Graham Number of $3.81—about a 1,300% negative margin of safety. I need many more profitable quarters and positive cash flow before calling this a bargain.

In plain English: Eton Pharmaceuticals makes and sells medicines for rare diseases. Sales are growing quickly, and the company just had a profitable quarter, but it lost money in each of the last four fiscal years and does not currently generate positive free cash flow. At the recent price, the market is paying a lot for those earnings and assets.

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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