Adverum Biotechnologies, Inc. :ADVM-US: Earnings Analysis: 2016 By the Numbers : March 15, 2017

Adverum Biotechnologies, Inc. reports financial results for the year ended December 31, 2016.

We analyze the earnings along side the following peers of Adverum Biotechnologies, Inc. – OncoGenex Pharmaceuticals, Inc., Agilent Technologies, Inc. and Acceleron Pharma Inc (OGXI-US, A-US and XLRN-US) that have also reported for this period.


  • Year-on-year change in operating cash flow of -8.57% is about the same as the change in earnings, likely no significant movement in accruals or reserves.
  • Narrowing of operating margins contributed to decline in earnings.

The table below shows the preliminary results and recent trends for key metrics such as revenues and net income growth:

2016 2015 2014 2013 2012
Relevant Numbers (Annual)
Revenues 1.46 2.32 0.57 0.48 0.03
Revenue Growth (YOY) N/A N/A N/A N/A N/A
Earnings -113.75 -47.45 -28.63 -5.28 -1.81
Earnings Growth (YOY) -139.7 -65.72 -442.72 -191.33 N/A
Net Margin -7817.66 -2046.27 -5005.94 -1099.17 -6036.67
EPS -3.14 -1.86 -2.46 -0.25 -0.08
Return on Equity -48.59 -23.6 -38.37 N/A N/A
Return on Assets -45.6 -22.27 -35.14 -717.34 -469.17

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Cash Versus Earnings – Sustainable Performance?

It is important to examine a company�s cash versus earnings numbers to gauge whether its performance is sustainable.

ADVM-US‘s change in operating cash flow of -8.57% compared to the same period last year is about the same as its change in earnings this period. Additionally, this change in operating cash flow is about average among its peer group. This suggests that the company did not use accruals or reserves to manage earnings this period, and that, all else being equal, the earnings number is sustainable.

Operating Cash Flow Growth Versus Earnings Growth

Quadrant label definitions. Hover to know more

Cash Flow based Earnings, Likely Non-cash Earnings, Low Cash Flow Base, Likely Undeclared Earnings


The company’s decline in earnings has been influenced by the following factors: (1) Decline in operating margins (EBIT margins) from -1,955.58% to -3,601.10% and (2) one-time items that contributed to a decrease in pretax margins from -2,050.58% to -7,893.33%

EBIT Margin Versus PreTax Margin

Quadrant label definitions. Hover to know more

Operation driven Earnings, One-time Favorables, Low Earnings Base, One-time Unfavorables
EBIT Margin History
PreTax Margin History

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Company Profile

Adverum Biotechnologies, Inc. is a clinical-stage biotechnology company that engages in the development of novel gene therapies to treat patients with sight-threatening ophthalmic diseases. It focuses on treatment of wet age-related macular degeneration, alpha-1 antitrypsin deficiency, hereditary angioedema, friedreich’s ataxia, severe allergy, color vision deficiency, and juvenile x-linked retinoschisis. The company was founded by Mark S. Blumenkranz, Thomas W. Chalberg, Jr. and Steven Daniel Schwartz on July 17, 2006 and is headquartered in Menlo Park, CA.

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