Everything You Need to Know About Sorrento Therapeutics' Massive Debt
Though Sorrento Therapeutics (NASDAQ: SRNE) has a roster of coronavirus testing and therapeutics programs, it's also carrying a whopping $141.79 million in net debt, which is a heavy burden compared to its trailing 12-month revenues of $35.54 million and its $24.39 million in cash. The company's current ratio is 0.6, which implies it could have trouble meeting its short-term debt obligations. These figures are dire enough to make some investors run for the hills, but those who look closer will find there's more to the story of this company that's focused on developing antibody treatments for cancer.
Given its heavy debt load, why and how did the company announce the full prepayment of outstanding term loans worth $120 million in June? Should shareholders dump this stock quickly, or is there a buying opportunity in the works? Let's take a look at the company's balance sheet to get some answers.
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Source Fool.com