Arcutis Biotherapeutics, Inc. (ARQT) stock analysis
Close on Nov 11, 2026Market cap $3.57BP/E 129.0Yield –
StockData Score
Prices as of Nov 11, 2026How the score works
Mixed11 of 30 checks passed
Arcutis Biotherapeutics passes 11 of the 30 checks behind our score; 10 could not be run for lack of data and count as not passed. Each dot in the shape is one check — hover it for the numbers.
- Valuation
- 0/6
- Growth
- 4/6
- Past performance
- 4/6
- Financial health
- 3/6
- Dividend
- 0/6
What stands out
Return on capital over 10%
Return on invested capital was 32.9%, above the 10% that usually covers the cost of capital.
Revenue growing 10%+ a year
Revenue grew 367% a year over the last three fiscal years.
Debt covered by cash flow
Operating cash flow over the last twelve months equals 54.8% of total debt.
Low bankruptcy risk
The Altman Z-score is 6.58; above 3 is the safe zone and below 1.8 the distress zone.
What to watch
Margin of safety under 20%
The price is 371% above fair value, so there is no margin of safety.
Trading above fair value
The share price of $28.38 is above our fair value estimate of $6.03.
Return on equity under 15%
Return on equity was 14.9% over the last twelve months and averaged -98.9% over five years; we look for 15% on both.
High debt
Debt is 44.8% of shareholders' equity, above the 40% we consider low.
Valuation0/6
P/E against its history
Not enough price and earnings history to compare.
P/E above the industry
Arcutis Biotherapeutics's P/E of 129.0 is above the Drugs median of 25.1.
EV/EBITDA against its history
Needs positive EBITDA and price history.
P/B above the industry
Arcutis Biotherapeutics's price-to-book of 14.62 is above the Drugs median of 2.29.
Trading above fair value
The share price of $28.38 is above our fair value estimate of $6.03.
Margin of safety under 20%
The price is 371% above fair value, so there is no margin of safety.
Growth4/6
Revenue growing 10%+ a year
Revenue grew 367% a year over the last three fiscal years.
EPS growth over 3 years
Needs positive EPS three years ago and today.
Earnings acceleration
Needs positive net income now, a year ago and five years ago.
Growing faster than the industry
Revenue grew 60.0% over the last twelve months; the Drugs median is 8.0%.
Guidance raised
Arcutis Biotherapeutics raised its full year 2026 net product sales outlook on Aug 5, 2026.
Gross margin improving
Gross margin was 91.2% over the last twelve months, against 90.0% a year earlier.
Past performance4/6
Return on equity under 15%
Return on equity was 14.9% over the last twelve months and averaged -98.9% over five years; we look for 15% on both.
Return on capital over 10%
Return on invested capital was 32.9%, above the 10% that usually covers the cost of capital.
Return on equity above the industry
Arcutis Biotherapeutics's return on equity of 14.9% is above the Drugs median of -58.9%.
Earnings over 5 years
Needs positive net income five years ago and in the latest year.
Net margin above its 5-year average
Net margin was 5.9% over the last twelve months, against a 5-year average of -2241%.
Net margin above the industry
Arcutis Biotherapeutics's net margin of 5.9% is above the Drugs median of -53.0%.
Financial health3/6
High debt
Debt is 44.8% of shareholders' equity, above the 40% we consider low.
Debt rising against equity
Debt to equity rose from 0.0% five years ago to 44.8%.
Debt covered by cash flow
Operating cash flow over the last twelve months equals 54.8% of total debt.
Interest not well covered
Operating income covers interest expense 2.6 times; we look for at least 5.
Short-term assets cover short-term debts
Current assets are 2.92 times current liabilities.
Low bankruptcy risk
The Altman Z-score is 6.58; above 3 is the safe zone and below 1.8 the distress zone.
Dividend0/6
No dividend
Arcutis Biotherapeutics has not paid a dividend in the last twelve months.
Yield against Treasuries
No dividend.
Yield against the market
No dividend.
Dividend stability
No dividend.
Earnings cover
No dividend.
Cash-flow cover
No dividend.
Fair value
How we estimate itOur estimate per share
$6.03
The share price is 371% above this estimate.
| Method | Multiple used | Own 5Y median | Industry median | Value per share | Weight |
|---|---|---|---|---|---|
| P/E | 25.1× | – | 25.1× | $5.52 | 47% |
| EV/EBITDA | 17.1× | – | 17.1× | $5.97 | 41% |
| P/B | 4.3× | 6.2× | 2.3× | $8.27 | 12% |
| Fair value | $6.03 | 100% | |||
Valuation over time
Using the earnings and balance sheet published at each date, not today's.
- P/B at month end
- Own 5-year median 6.2
- Drugs median 2.3
An estimate from reported numbers and market multiples, not a price target or investment advice. It can be far off for companies whose profits are about to change sharply.
Market risk
From the past year of daily prices.
Liquidity
Low risk
- Average value traded per day
- $71.46M
- Value traded per 1% price move
- $24.39M
Downside
Medium risk
- Typical loss in a bad month
- 17.8%
- Volatility (annualized)
- 56%
- Sharpe ratio, 1 year
- 0.27
- Beta to the S&P 500 (5Y)
- 0.92
Typical bad-month loss, week by week
Margins
Share of revenue, fiscal years 2017 to 2025
Gross margin
Operating margin
Net margin
Growth rates
Compound annual growth to fiscal 2025
| Per year | 1 year | 3 years | 5 years | 10 years | Five-year pace |
|---|---|---|---|---|---|
| Revenue | +91.3% | +367.3% | – | – | |
| Gross profit | +91.3% | +387.3% | – | – |
Returns and balance sheet
9 fiscal years. Hover a measure to see how it is calculated.
| Measure | FY2017 | FY2020 | FY2025 | Trend |
|---|---|---|---|---|
| Return on equity | – | -132.0% | -9.3% | |
| Return on assets | – | -67.0% | -4.1% | |
| Current ratio | – | 12.96 | 3.17 | |
| Debt to equity | – | 0.00 | 0.58 | |
| Interest coverage | – | – | -1.0× | |
| Inventory turnover | – | – | 2.0× | |
| Capex to revenue | – | – | 0.2% | |
| Diluted shares | – | 36M | 127M |
Where the cash went
Fiscal 2021 to 2025, five years combined
Arcutis Biotherapeutics generated $797.18M from operations and spent $2.59M on capital expenditure, dividends and share buybacks. 100% of that went back into the business.
DuPont analysis
Return on equity split into margin, efficiency and leverage
| Fiscal year | Net margin | Asset turnover | Equity multiplier | Return on equity |
|---|---|---|---|---|
| FY2025 | -4.3% | 0.96× | 2.25× | -9.3% |
| FY2024 | -71.3% | 0.57× | 2.80× | -113.8% |
| FY2023 | -439.8% | 0.15× | 2.65× | -175.8% |
| FY2022 | -8449.8% | 0.01× | 1.69× | -122.8% |
Piotroski F-Score
Nine tests of profitability, balance sheet and efficiency, fiscal 2025 against fiscal 2024
- ProfitableNet income above zero-$16.14M
- Cash generatingOperating cash flow above zero-$5.63M
- Return on assets improvedROA up on the prior year-41.0% → -4.6%
- Earnings backed by cashOperating cash flow above net income-$5.63M vs -$16.14M
- Less leverageLong-term debt to assets fell30.7% → 24.9%
- Better liquidityCurrent ratio rose4.15 → 3.17
- No dilutionShare count did not rise121M → 127M
- Gross margin improvedGross margin up on the prior year90.27% → 90.24%
- More efficientAsset turnover rose0.58 → 1.08
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