Verastem, Inc.
$3.62
-5.0%Verastem, Inc., a development-stage biopharmaceutical company, focusing on developing and commercializing drugs for the treatment of cancer. Its product in development includes VS-6766, a dual rapidly accelerated fibrosarcoma (RAF)/mitogen-activated protein kinase (MEK) clamp that blocks MEK kinase activity and the ability of RAF to phosphorylate MEK. The company also engages in developing RAMP 201, an adaptive two-part multicenter, parallel cohort, randomized open label trial to evaluate the efficacy and safety of VS-6766 and in combination with defactinib, an oral small molecule inhibitor of focal adhesion kinase (FAK) in patients with recurrent low grade serous ovarian cancer; and RAMP 202, which is in Phase 2 trial to evaluate the safety of VS-6766 in combination with defactinib in patients with KRAS and BRAF mutant non-small cell lung cancer following treatment with a platinum-based regimen and immune checkpoint inhibitor. Verastem, Inc. has license agreements with Chugai Pharmaceutical Co., Ltd. for the development, commercialization, and manufacture of products containing VS-6766; and Pfizer Inc. to research, develop, manufacture, and commercialize products containing Pfizer's inhibitors of FAK for therapeutic, diagnostic and prophylactic uses in humans. In addition, it has clinical collaboration agreement with Amgen, Inc. to evaluate the combination of VS-6766 with Amgen's KRAS-G12C inhibitor LUMAKRASTM which in Phase 1/2 trial entitled RAMP 203. The company was incorporated in 2010 and is headquartered in Needham, Massachusetts.
At a Glance
Live SnapshotIntrinsic Alpha Methodology
Thesis Lenses
Signal
Medium confidenceValuation multiple is compressed (P/E -1.2).
Valuation inputs: P/E -1.2, earnings yield N/A, momentum -5.0%.
If multiples stay elevated while momentum fades, downside repricing risk rises.
Driver
High confidenceReturn profile is soft (ROE -3.7%, ROIC -97.4%).
Profitability stack: net margin -6.8%, ROE -3.7%, ROIC -97.4%.
Quality deterioration often appears in margins before it shows up in headline EPS.
Risk
High confidenceDownside profile is elevated and scenario stress-testing is essential.
Risk factors: liabilities/assets +76.8%, momentum -5.0%, net margin -6.8%.
Higher leverage with weak momentum and thin margins can amplify drawdown severity.
Verastem, Inc. Market vs Earnings Trajectory
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Verastem, Inc. Fair Value Envelope
Verastem, Inc. Profit Bridge
Profitability Analysis
Gross Margin
Exceptional pricing power and cost management. The company retains over half of revenue after direct costs.
Operating Margin
Operating losses indicate the core business is unprofitable. Requires restructuring or revenue growth.
Net Profit Margin
Net losses indicate the company is burning cash. Sustainability depends on path to profitability.
Profitability Insight
Margin squeeze alert: Healthy gross margins but weak operating margins suggest excessive operating expenses. Cost optimization could unlock significant value.
Verastem, Inc. Cash Conversion Engine
Cash Flow Quality Analysis
FCF Conversion Rate
Moderate conversion rate. Some gap between earnings and cash flow may warrant investigation into working capital or non-cash items.
FCF Growth Trend
Significant FCF decline raises concerns. Urgent review needed of operational performance and capital allocation.
Working Capital Impact
Working capital inflow boosted cash flow. Efficient management of receivables, inventory, and payables contributing positively.
Verastem, Inc. Funding & Solvency Profile
Financial Health Analysis
Current Ratio
Excellent liquidity position. The company can easily cover its short-term obligations with substantial cushion.
Debt-to-Equity Ratio
Elevated leverage. Debt exceeds equity, which amplifies both gains and risks. Monitor debt servicing ability.
Working Capital
Strong working capital position provides significant operational flexibility and financial cushion.
Asset Composition
Asset-light business model with high liquidity. Majority of assets are easily convertible to cash.
Financial Health Insight
Mixed signals: Strong short-term liquidity provides comfort, but high overall leverage requires careful monitoring of debt servicing capabilities and refinancing risk.
Verastem, Inc. Street Expectations Map
Wall Street analysts project that VSTM stock may rise significantly over the coming 12 months. The consensus 1-year price target stands at 18.25, with estimates ranging from a low of 18.00 to a high of 19.00.
The consensus 1-year price target stands at 18.25, with estimates ranging from a low of 18.00 to a high of 19.00.
Analyst Consensus Analysis
Upside Potential
Substantial upside potential. Analysts see significant value gap, suggesting the stock may be materially undervalued at current levels.
Analyst Agreement
High analyst agreement. Narrow target range indicates strong consensus on valuation, suggesting clear investment thesis and predictable outlook.
Analyst Conviction
Strong buy conviction: High upside with tight consensus suggests compelling investment opportunity backed by analyst confidence.
Market Sentiment Insight
Rare opportunity: Exceptional upside potential with strong analyst consensus creates a compelling setup. The combination of significant price target premium and tight agreement suggests high-conviction undervaluation that may attract institutional capital.
Verastem, Inc. Insider Positioning
During the last 12 months, insiders have sold $580K worth of VSTM shares, with no buying activity reported.
3 Months
0
0.00
806
4.69K
-5K
-$5K
3-6 Months
0
0.00
25.7K
210.32K
-210K
-$210K
6-9 Months
0
0.00
36.1K
365.00K
-365K
-$365K
9-12 Months
0
0.00
0
0.00
+0
+$0
Top Buyers
No buying activity
Top Sellers
Paterson Dan
Director, Officer: President And Ceo
$387K
Kauffman Michael
Director
$86K
Bunn Paul A.
Director
$63K
Calkins Daniel
Officer: Chief Financial Officer
$37K
Stuglik Brian M
Director
$5K
Insider Activity Analysis
Net Insider Sentiment
Strong bearish signal with $580K net selling. Heavy insider selling may indicate concerns about valuation or near-term prospects.
Buy/Sell Ratio
Very poor ratio. Heavy selling with minimal buying suggests insiders may be concerned about valuation or outlook.
Recent Trend (3 Months)
Heavy recent selling activity. Recent insider sales notably exceed purchases—may warrant investigation into company developments.
Insider Participation
5 insider sellers vs. 0 buyers. Widespread selling across multiple insiders may signal concerns.
Insider Activity Insight
Multiple red flags: Heavy selling, numerous sellers, and continued recent selling create a concerning pattern. Investigate fundamental drivers and consider whether company guidance or industry conditions have deteriorated.
No Dividend Yield Data
VSTM has not reported any dividend yield values in the available annual periods.
vstm Dividend History
Learning Layer
Related Guides
Build conviction on VSTM by pairing this stock hub with focused valuation guides.
Research Paths
Snapshot
Start with context, operating signals, and key market metrics.
Value Model
Stress test fair value across bear, base, and bull assumptions.
Statements
Validate revenue quality, margins, and balance sheet durability.
Earnings Call
Read management commentary and compare it with reported outcomes.
Dividends
Check payout sustainability and long-term distribution behavior.
Analyst Expectations
Review consensus spread and where estimate risk is concentrated.