Cryoport Inc: Institutions & Insiders Love This Life Sciences Services Stock

Cryoport Stock’s Price Weakness Means Opportunity

The COVID-19 pandemic brought attention to the life sciences space as pharmaceutical companies searched for a vaccine. A segment of the biotech industry that I like is the transportation of biologic and cell-based products and therapies in safe and secure ways. Think about how critical transporting biomaterials is.

To play the life sciences transportation space, take a look at Cryoport Inc (NASDAQ:CYRX), a provider of products and services for companies in the biopharma, reproductive medicine, and animal health sectors.

CYRX stock traded as low as $20.21 in May 2020, prior to mounting an impressive rally to $84.97 in January 2021.

Cryoport stock failed to hold and is down 39% from its high. At its current price, I view CYRX stock as an aggressive opportunity.

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Chart courtesy of StockCharts.com

Strong Revenue Growth Offers Pathway to Profits

Cryoport Inc’s five-year revenue picture shows double- to triple-digit growth in five consecutive years to a record $78.7 million in 2020. The company generated a compound annual growth rate (CAGR) of 73.4% during this time frame.

Fiscal YearRevenues (Millions)Growth
2016$8.2107.5%
2017$11.946.4%
2018$19.664.2%
2019$33.972.9%
2020$78.7131.9%

(Source: “Cryoport Inc,” MarketWatch, last accessed May 25, 2021.)

The company’s outlook is bullish, with analysts estimating that Cryoport will drive its revenues up by 168.1% to $210.9 million this year and by a more normalized 19.0% to $250.9 million in 2022. (Source: “Cryoport, Inc. (CYRX),” Yahoo! Finance, last accessed May 25, 2021.)

While the revenue side looks great, the company needs to contain its spending and deliver earnings before interest, taxes, depreciation, and amortization (EBITDA) income.

Fiscal YearEBITDA (Millions)Growth
2016-$7.8N/A
2017-$7.27.2%
2018-$7.8-7.7%
2019-$15.0-92.6%
2020-$9.040.1%

(Source: MarketWatch, op. cit.)

Cryoport also needs to provide a pathway to generally accepted accounting principles (GAAP) earnings-per-share (EPS) profits.

Fiscal YearGAAP Diluted EPSGrowth
2016-$0.90N/A
2017-$0.3462.2%
2018-$0.340.4%
2019-$0.55-62.1%
2020-$1.94-254.3%

(Source: MarketWatch, op. cit.)

Cryoport Inc is expected to narrow its GAAP loss to $0.49 per share this year and follow that with a GAAP loss of $0.21 per share in 2022. (Source: Yahoo! Finance, op. cit.)

Meanwhile, the company’s attainment of positive free cash flow is likely still a few years away, but much of that will depend on Cryoport controlling its costs.

Fiscal YearFree Cash Flow (Millions)Growth
2016-$4.4N/A
2017-$5.3-20.4%
2018-$6.3-18.3%
2019-$6.7-6.3%
2020-$23.8-257.1%

(Source: MarketWatch, op. cit.)

A plus for the company is its strong balance sheet, which will allow time for the company to work on increasing its revenues.

Cryoport Inc has extremely strong working capital, a debt of $131.7 million, and healthy cash of $353.2 million. (Source: Yahoo! Finance, op. cit.)

Analyst Take

Institutions love Cryoport stock. The number of institutional investors has been rising, with 297 institutions holding a 94.5% stake. (Source: Yahoo! Finance, op. cit.)

We’ve also been seeing major buying from insiders. Over the last six months, insiders purchased a net 1.5 million shares of CYRX stock. (Source: Yahoo! Finance, op. cit.)

I suggest following the lead of the institutions and insiders and look at Cryoport Inc.