HROW’s annual revenue growth has maintained an average of 40% for 10 years. Falling growth in one quarter triggered a 60% pull back in 24/25, but mgt. is guiding for a return to 40% in 25
Six months ago one of you introduced me to Harrow (thank you). Improving mgt messages and valuation triggered an entry in early May.
Positive growth, financials, management guidance and now CF’s 100% price appreciation target make HROW a candidate for consideration.
Gray
I’ve been looking at HROW for a while. The numbers are good but I don’t know enough about the pharma business: PBMs and insurance reimbursement, Medicare and Medicaid issues and cuts, etc. Perhaps someone with more knowledge of the industry can weigh in.
I have about a 5% allocation to HROW and have held it for 9 months or so. It’s important to know that the revenue growth is wildly lumpy with Q2 and Q4 being seasonally strongest; in the last CC they said these “normal seasonal revenue fluctuations” would continue in FY25. They also missed analyst expectations pretty bad in the last ER but maintained FY guidance of 40% revenue growth, basically doubling down that Q2 and Q4 would be strong.
FWIW the analyst expectations for this one are very strong going forward for the next 2-3 years and it’s quite “cheap” on a relative basis. And most importantly it seems they have turned a corner on profitability.
Expected revenue growth:
FY25 - 42%
FY26 - 37%
FY27 - 73%
Expected EBITDA growth:
FY25 - 108%
FY26 - 61%
FY27 - 105%
Expected (adj) EPS growth:
FY25 - turns positive
FY26 - 137%
FY27 - 125%
So for instance it trades at 16x EV/FY25 EBITDA with EBITDA growing 108%, or 10x EV/FY26 EBITDA growing EBITDA at 61%
EPS turns positive in FY25 but then looking at FY26 it trades at 17x FY26 earnings but growing EPS at 137% for a PEG of 0.1
