Value
9.3/10data confidence 33%| Component | Sub-score |
|---|---|
| P/S | 9.8 |
| Analyst target | 9.0 |
- ▸Attractively valued
EVO · Why this verdict
Why Evotec (EVO) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
Show full disclosure ▾Hide full disclosure ▴
About TrendMatrix. TrendMatrix is a publisher of general securities research and market commentary. We publish on a regular schedule. All content is the same for every subscriber in a tier — we do not provide personalized investment advice and we do not take into account any individual subscriber's financial situation, investment objectives, risk tolerance, tax situation, or holdings.
Not investment advice. TrendMatrix is not a registered investment adviser. Our content is for informational and educational purposes only. Consult your own licensed investment adviser, broker, or tax professional before making any investment decision.
Conflicts and positions. People who build TrendMatrix, or entities they control, may hold positions, long or short, in securities it covers, and may trade them at any time. Positions are not disclosed individually. Verdicts are generated by an automated model applied by the same rules to every covered stock, and are not adjusted for any position held by the people who build TrendMatrix. We do not accept payment from issuers for coverage.
No paid promotion. TrendMatrix does not accept payment from any issuer, broker, or third party in exchange for coverage of any security.
No fiduciary duty. No fiduciary, advisory, or agency relationship is created between you and TrendMatrix by reading our content or subscribing to our service.
Performance. Past performance is not indicative of future results. Performance figures reflect the published model only and do not reflect any individual subscriber's actual results.
VerdictSELL
Overall score4.5/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Evotec is a deeply discounted (65% drawdown) specialty drug services company with declining revenue, cash burn and repeated earnings misses; the only bull argument is a 139.5% gap to a thinly covered analyst target of $3.59.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Quality scores 1.6, below the 4.0 minimum: free cash flow is -11% of revenue, the Piotroski F-Score is 3/9, and margins all score 0.0 with no moat. Quality breakdown | Free cash flow should move toward breakeven and Piotroski F-Score rise above 5/9. | →Stable |
| CounterCurrent ratio scores 8.0, so liquidity is adequate and a restructuring could improve margins without a liquidity squeeze. | ||
Revenue is declining 16% YoY, with the June 2026 quarter at $143.5M versus $171.2M a year earlier. Growth breakdown | Quarterly revenue should stabilize above $140M and revenue growth turn positive within 12 months. | →Stable |
| CounterQuarterly revenue is lumpy, with $253.3M in December 2025, so a single weak quarter may overstate the decline; revenue data is provisional. | ||
Earnings missed in 3 of the last 4 reports, with an average surprise of -82%, including a -$0.13 result in August 2026. Earnings | Next report on 2026-11-05 should beat estimates and EPS losses narrow. | ↑Improving |
| CounterEstimates are volatile and losses may be driven by one-time restructuring items, so the miss streak could end quickly. | ||
Price of $1.50 is 139.5% below the $3.59 analyst target, with 11.3% downside, for a reward-to-risk of 12.31. Upside pct | Price should recover toward the $3.59 target as losses narrow. | →Stable |
| CounterAnalyst coverage is light (3 analysts), the stock is in a confirmed downtrend with a 200-day average sloping -8.4% per 30 days, and the target may be stale. | ||
Quality scores 1.6, below the 4.0 minimum: free cash flow is -11% of revenue, the Piotroski F-Score is 3/9, and margins all score 0.0 with no moat.
→StableQuality breakdown
- Expectation
- Free cash flow should move toward breakeven and Piotroski F-Score rise above 5/9.
CounterCurrent ratio scores 8.0, so liquidity is adequate and a restructuring could improve margins without a liquidity squeeze.
Revenue is declining 16% YoY, with the June 2026 quarter at $143.5M versus $171.2M a year earlier.
→StableGrowth breakdown
- Expectation
- Quarterly revenue should stabilize above $140M and revenue growth turn positive within 12 months.
CounterQuarterly revenue is lumpy, with $253.3M in December 2025, so a single weak quarter may overstate the decline; revenue data is provisional.
Earnings missed in 3 of the last 4 reports, with an average surprise of -82%, including a -$0.13 result in August 2026.
↑ImprovingEarnings
- Expectation
- Next report on 2026-11-05 should beat estimates and EPS losses narrow.
CounterEstimates are volatile and losses may be driven by one-time restructuring items, so the miss streak could end quickly.
Price of $1.50 is 139.5% below the $3.59 analyst target, with 11.3% downside, for a reward-to-risk of 12.31.
→StableUpside pct
- Expectation
- Price should recover toward the $3.59 target as losses narrow.
CounterAnalyst coverage is light (3 analysts), the stock is in a confirmed downtrend with a 200-day average sloping -8.4% per 30 days, and the target may be stale.
Per-dimension breakdown
Quality
1.6/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 0.0 |
| ROA | 0.0 |
| Gross margin | 0.0 |
| Op margin | 0.0 |
| Net margin | 0.0 |
| Current ratio | 8.0 |
| FCF quality | 0.0 |
| Moat | 3.2 |
| Piotroski F | 3.3 |
- ▸Cash-burning: FCF -11% of revenue
- ▸No competitive moat
- ▸Weak Piotroski F-Score: 3/9
- ▸Quality concerns
Growth
0.0/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 0.0 |
- ▸Declining revenue: -16%
Momentum
6.1/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 6.5 |
| OBV | 10.0 |
| MA position | 4.0 |
| Volume | 5.5 |
- ▸Volume accumulation (rising OBV)
- ▸Below 200-MA, MA slope -8.8%/30d — confirmed downtrend
Sentiment
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 5.9 |
| Analyst rating | 6.1 |
| Price target | 10.0 |
- ▸Light analyst coverage (3.0) — signal dampened
- ▸Analyst upside: 162%
Insider
5.0/10data confidence 50%Peer rank
3.8/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 8.5 |
| quality rank | 1.6 |
| growth rank | 0.3 |
Technical
2.0/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 2.8 |
| support resistance | 3.1 |
| 52w position | 0.0 |
Risk (lower is worse)
6.8/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 10.0 |
| days to cover | 10.0 |
| volatility | 2.5 |
| beta | 5.9 |
| debt equity | 6.7 |
| news risk | 5.5 |
Catalyst
3.4/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 4.0 |
| earnings history | 1.1 |
| earnings timing | 5.0 |
| surprise avg | 0.0 |
| news activity | 7.0 |
- ▸Earnings concerns: 1B/2M
- ▸Earnings in 7 days
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCK:QUALITY_FLOORPassed (7)
- MOMENTUM:6.1>=5.5
- ASYMMETRY:8.2>=1.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_BOOST:ANALYST:0.60
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- EARNINGS_PROXIMITY:7d<=7d
Warning (1)
- DEATH_CROSS:momentum=6.1>=5.0 recovering
Reward-to-Risk
8.17
Upside
+122.5%
Downside
15.0%
Sizing output
AVOID
SetupRecovery — Death cross but MACD improving, RSI 53
EdgeInst Constrain — Small cap ($0.6B) below institutional reach
SuitabilitySpeculative — Drawdown -62% (>40% off 52w high)
Investment implication
The SELL_IF_HOLDING verdict reflects the EARNINGS_PROXIMITY gate's 7d<=7d outcome against Value at 9.3 and asymmetric R:R of 8.17.
The strongest dimensions are Value at 9.3, Sentiment at 7.2, and Risk (lower is worse) at 6.8; the weakest are Growth at 0.0, Quality at 1.6, and Technical at 2.0. The V9 engine flagged 1 failed gate with 1 warning, producing an asymmetric reward-to-risk of 8.17 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Shrinking Revenue Base
Trip ifQuarterly revenue falls below $130M.
- P2Cash Burn Weak Quality
Trip ifFree cash flow burn exceeds 20% of revenue.
- P3Earnings Miss Pattern
Trip ifEPS surprise stays below 0% for 2 consecutive quarters.
- P4Deep Discount Analyst Upside
Trip ifShare price drops to $1.40 or lower, the stop-loss level, from the current $1.50.