HRMY · Health care(pharmaceutical preparations) · 9 years of annual accounts filed with the SEC · latest fiscal year ended 2025-12-31
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Harmony Biosciences Holdings, Inc. reported revenue of $868.5 million in fiscal 2025. Of the $952.0 million its operations generated over 9 years, 10.5% went to buybacks. On the accounting screens, it passes 5 of 9 Piotroski tests, its Altman Z'' of 7.17 is in the safe zone and its Beneish M-score is below the -1.78 line; none of the six cross-checks between its statements fires.
Revenue, fiscal 2025868.5M
Operating margin24.0%gross margin 77.2%
Return on invested capital14.9%16.1% on average over 5 years
Free cash flow after stock pay303.0M34.9% of revenue
Net debt ÷ EBITDANet cash588.8M more cash than debt
Piotroski F-score5/9tests of improvement passed
Share counts are in today's shares. The SEC's filings restate only recent years after a split, so these jumps were read as splits and the older years scaled to match — otherwise per-share figures would compare different units:
7-for-1 before fiscal 2020.
Is it growing?
Revenue and the operating income it turns into. Growth that does not reach operating income is growth bought with margin.
RevenueOperating income
-500.0M0500.0M1.0B
2018
2019
2019Revenue 6.0MOperating income -145.9M
2020Revenue 159.7MOperating income 17.0M
2021Revenue 305.4MOperating income 87.5M
2022Revenue 437.9MOperating income 120.2M
2023Revenue 582.0MOperating income 192.0M
2024Revenue 714.7MOperating income 190.8M
2025Revenue 868.5MOperating income 208.5M
201820192019202020212022202320242025
Compound growth a year
3 yrs
5 yrs
8 yrs
Revenue
+25.6%
+40.3%
—
Operating income
+20.2%
+65.1%
—
Net income
-4.4%
—
—
Earnings per share
-3.0%
—
—
Free cash flow per share
+36.0%
—
—
Shares
-1.4%
+17.8%
—
Falling shares are buybacks: each remaining share owns more of the company.
Does it earn more than its capital costs?
Margins say how much of each sale is kept; return on invested capital says how much the business earns on the money it needs to operate. Growth only creates value when that return is above the cost of the capital.
Return on invested capitalCost of capital today · 9.6%
0.0%10.0%20.0%30.0%
2018
2019
2019
2020
2021Return on invested capital 21.4%
2022Return on invested capital 5.4%
2023Return on invested capital 21.6%
2024Return on invested capital 17.3%
2025Return on invested capital 14.9%
201820192019202020212022202320242025
Economic profit
Economic profit
-50.0M050.0M100.0M
2018
2019
2019
2020
2021Economic profit 44.6M
2022Economic profit -25.1M
2023Economic profit 79.2M
2024Economic profit 64.2M
2025Economic profit 54.5M
201820192019202020212022202320242025
(return on capital − cost of capital) × capital invested: the profit left after paying for the money used. Today's cost of capital is applied to every year, since a past one cannot be rebuilt honestly.
Return on equity
18.2%
Return on assets
12.5%
Asset turnover
0.68×
Research & development
21.8% of revenue
Overheads (SG&A)
17.6% of revenue
Is the profit cash, and where does the cash go?
Net income is an accounting opinion; free cash flow is what was left in the bank after investing. Stock-based pay does not leave the bank — shareholders pay it through dilution — so it is shown taken off as well.
Net incomeFree cash flowAfter stock-based pay
-200.0M0200.0M400.0M
2018
2019
2019Net income -152.0MFree cash flow -75.6MAfter stock-based pay -85.5M
2020Net income -36.9MFree cash flow -3.0MAfter stock-based pay -7.7M
2021Net income 34.6MFree cash flow 98.3MAfter stock-based pay 82.6M
2022Net income 181.5MFree cash flow 144.3MAfter stock-based pay 118.1M
2023Net income 128.9MFree cash flow 219.1MAfter stock-based pay 187.4M
2024Net income 145.5MFree cash flow 218.7MAfter stock-based pay 176.1M
2025Net income 158.7MFree cash flow 347.9MAfter stock-based pay 303.0M
201820192019202020212022202320242025
Where 9 years of operating cash went, 2018–2025
952.0M generated by the business. Each band is its share of that total.
Reinvested in the business 0%2.4M
Acquisitions 4%37.0M
Dividends 0%0
Share buybacks 11%100.2M
Kept, or used to pay down debt 85%812.5M
Over the same years it paid 184.0M in stock. The buybacks did not even cover what was handed out in stock.
Per share
Earnings per shareFree cash flow per shareDividend per share
$-20.00$-10.00$0.00$10.00
2018
2019
2019Earnings per share $-19.54Free cash flow per share $-9.72
2020Earnings per share $-1.43Free cash flow per share $-0.12
2021Earnings per share $0.58Free cash flow per share $1.66
2022Earnings per share $2.97Free cash flow per share $2.36
2023Earnings per share $2.13Free cash flow per share $3.63
2024Earnings per share $2.51Free cash flow per share $3.78
2025Earnings per share $2.71Free cash flow per share $5.94
201820192019202020212022202320242025
Shares outstanding
Diluted shares
020.0M40.0M60.0M80.0M
2018
2019
2019Diluted shares 7.8M
2020Diluted shares 25.8M
2021Diluted shares 59.2M
2022Diluted shares 61.1M
2023Diluted shares 60.4M
2024Diluted shares 57.9M
2025Diluted shares 58.5M
201820192019202020212022202320242025
How strong is the balance sheet?
Debt is not bad in itself; debt the business cannot service in a bad year is. Net debt is debt minus cash, and below zero the company holds more cash than it owes.
Net debt
-600.0M-400.0M-200.0M0200.0M
2018
2019
2019Net debt 73.5M
2020Net debt -34.4M
2021Net debt -42.3M
2022Net debt -52.1M
2023Net debt -118.1M
2024Net debt -273.7M
2025Net debt -588.8M
201820192019202020212022202320242025
Net debt ÷ EBITDA
—
Interest coverage
14× operating income ÷ interest
Current ratio
3.60 current assets ÷ current liabilities
Cash conversion cycle
18 days collects in 41d, stock 10d, pays in 33d
Three classic screens of the accounts
Each asks a different question of the same statements — is it improving, does it look like a company heading for distress, do the accounts resemble ones that were manipulated. None is a verdict; each shows what moves it.
Piotroski F-score
Is the business improving? Nine yes-or-no tests, this year against last.
5of 9 tests passed
✓ProfitableReturn on assets above zeropassed
✓Cash from operationsOperating cash flow above zeropassed
✕Profitability improvedReturn on assets higher than a year beforefailed
✓Profit backed by cashOperating cash flow above net income (low accruals)passed
✓Less long-term debtLong-term debt as a share of assets fellpassed
✓More liquidCurrent ratio higher than a year beforepassed
✕No new sharesShare count did not growfailed
✕Better gross marginGross margin higher than a year beforefailed
✕Sells more per assetAsset turnover higher than a year beforefailed
Where it misleads: it measures change, not level. An excellent business that stood still for a year scores low; a poor one recovering from a disaster scores high.
Altman Z''-score
Does the balance sheet look like those of companies that went bankrupt?
7.17safe zone
1.12.6
Working capital ÷ assets 0.51 × 6.56+3.38
Retained earnings ÷ assets 0.13 × 3.26+0.41
Operating income ÷ assets 0.16 × 6.72+1.10
Equity ÷ liabilities 2.17 × 1.05+2.28
Where it misleads: buybacks. A company that returns so much cash that its equity turns small or negative sinks the last two ratios without being anywhere near bankruptcy. Banks and insurers do not fit the model at all.
Beneish M-score
Do the accounts resemble those of companies that manipulated their earnings?
-3.01below the -1.78 line
-1.78
Receivables vs sales 0.96+0.88
Gross margin slipping 1.01+0.53
Soft assets 1.00 (not reported, set to 1)+0.40
Sales growth 1.22+1.08
Slower depreciation 1.00 (not reported, set to 1)+0.12
Overheads vs sales 1.14-0.20
Profit not in cash -0.15-0.70
Leverage rising 0.92-0.30
Where it misleads: fast growth and acquisitions. Sales growth carries a heavy weight, so a company growing 50% a year scores like a suspect without having done anything. It is a screen from a 1999 study, not an accusation.
Where the statements disagree
Cross-checks between the income statement, the balance sheet and the cash flow for the latest year, each with the benign reading and the worrying one.
None of the six cross-checks fires for the latest year: receivables and inventory move with revenue, profit turns into cash, investment keeps up with depreciation, the tax rate is ordinary and debt is moderate.
What is it worth, under which assumptions?
A company is worth the cash it will generate, brought back to today. This model projects revenue with growth that fades over the years, applies a free cash flow margin, and discounts the result at the cost of capital. Every assumption says where it came from, and all of them can be changed.
Value per share, with these assumptions$86.89discounted at 9.6% a year · 58% of it from after year 10
Type a share price on the left to ask the reverse questions: what growth, what margin or what discount rate that price implies.
What the value implies, in the usual multiples
At this model's value
Price ÷ earnings
32.1×
Enterprise value ÷ EBITDA
—
Enterprise value ÷ revenue
5.2×
Free cash flow yield
6.0%
From cash flows to a value per share
10 years of cash flow, today1.9B
Everything after, today2.6B
The whole business4.5B
Plus net cash588.8M
What belongs to shareholders5.1B
Divided among 58.5M shares: <strong>$86.89</strong> each.
The projection next to its history
Reported free cash flow after stock pay, then the model's. A projection that looks nothing like the past needs a reason.
ReportedProjected
-200.0M0200.0M400.0M600.0M
2018
2019
2019Reported -85.5M
2020Reported -7.7M
2021Reported 82.6M
2022Reported 118.1M
2023Reported 187.4M
2024Reported 176.1M
2025Reported 303.0M
2026Projected 160.1M
2027Projected 196.1M
2028Projected 235.3M
2029Projected 276.5M
2030Projected 318.0M
2031Projected 357.7M
2032Projected 393.5M
2033Projected 423.0M
2034Projected 444.2M
2035Projected 455.3M
2018201920212023202520272029203120332035
Year by year
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
Revenue
1.1B
1.3B
1.6B
1.9B
2.2B
2.4B
2.7B
2.9B
3.0B
3.1B
Growth
25.0%
22.5%
20.0%
17.5%
15.0%
12.5%
10.0%
7.5%
5.0%
2.5%
Cash margin
14.7%
14.7%
14.7%
14.7%
14.7%
14.7%
14.7%
14.7%
14.7%
14.7%
Free cash flow
160.1M
196.1M
235.3M
276.5M
318.0M
357.7M
393.5M
423.0M
444.2M
455.3M
Worth today
146.1M
163.2M
178.7M
191.6M
201.0M
206.3M
207.1M
203.1M
194.6M
181.9M
If the least-known inputs move
Value per share as two inputs change at a time. Neighbouring cells that differ a lot are the conclusion: the value depends on numbers nobody knows to a point.
The discount rate and growth forever
discount ↓ · forever →
1.5%
2.0%
2.5%
3.0%
3.5%
8.6%
90
95
101
108
117
9.1%
84
88
93
99
106
9.6%
79
83
87
92
98
10.1%
74
77
81
85
90
10.6%
70
73
76
80
84
Year-one growth and the final margin
margin ↓ · growth →
21.0%
23.0%
25.0%
27.0%
29.0%
11.8%
65
70
74
79
85
13.3%
71
75
81
86
92
14.7%
76
81
87
93
99
16.2%
81
87
93
100
107
17.7%
87
93
100
107
114
All the inputs moving at once
5,000 valuations, each with growth, final margin, discount rate and growth forever drawn at random around the values on the left (spreads of 3.0%, 2.2%, 1.0% and 0.5%). Not a probability — the spreads are assumptions too — but an honest picture of how wide the answer is.
10th percentile$67.67
Median$86.92
90th percentile$115.79
$75.00$100.00$125.00$150.00
Half of the simulations land between <b>$75.89</b> and <b>$100.54</b>; one in ten below $67.67, one in ten above $115.79.
Does the long run make sense?
15%To grow 2.5% forever while reinvesting 17% of its after-tax operating profit, the business must earn 15% on the new capital — it has earned 16% on average over the last five years.
58%of the value comes from after year 10. The more of it, the more the answer depends on the part nobody can see.
Every Form 4 filed in the last twelve months, read line by line: 6 filings by 5 people. Open-market purchases and sales are counted apart from awards, option exercises and shares withheld for taxes.
Bought on the open market—none in the period
Sold on the open market$3.1M7 sale(s) by 1 insider(s)
Under pre-arranged plans0%of the sales followed a 10b5-1 plan set months earlier
A Form 4 says what happened, when, how many shares and at what price. It does not say why: a sale can be diversification, a tax bill or a plan fixed months earlier, and an award is pay, not a purchase. Nothing here is a reason to buy or sell anything.
Which large funds report holding it
From the Form 13F of the 28 institutions followed on this site, as of the end of their last reported quarter. A 13F is filed up to 45 days later and shows only long positions in US-listed shares.
Accounts from the company's own SEC filings; lines some companies do not report are shown as a dash rather than estimated. The risk-free rate is the 10-year US Treasury yield. A DCF is a way of making assumptions explicit, not a forecast: it states what the company would be worth if the assumptions held. The scores are screens that point where to look, not verdicts. Nothing here is a recommendation to buy or sell.
