# Verastem (VSTM.US)

Canonical: https://gigainvestors.com/s/VSTM

Analysis as of: 2026-10-16T07:32:58.468Z. Financial observations: FY2011–FY2025.

Listing currency: USD. Reporting currency: USD.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: fail; earnings resilience is evidence only). Published buy qualification: no.

Share price: $9.23 per share; close as of 2026-10-15.

## Checklist

### understandable: fail

- 3 revenue declines in the last 10 years (informational)

- more than 2 net loss years

- negative average operating margin

- operating margin variation exceeds 0.35

- Financial history: 10 years

- Years with declining revenue: 3

- Years with a net loss: 10

- Operating margin variation: 0.89×

Chart: Operating margin; fiscal year observations.

- FY2018: -3.55×

- FY2019: -7.58×

- FY2020: -0.56×

- FY2021: -29.91×

- FY2022: -28.10×

- FY2024: -11.50×

- FY2025: -5.50×

### moat: fail

- Years with nonpositive invested capital use equity plus debt and leases; positive earnings with no positive capital are shown above 100%.

- ROIC median below threshold

- ROIC worst years below threshold (more than 1 bad year allowed)

- ROIC, median of available years: -73.7%

- ROIC, second-lowest year: -266.7%

- Years with nonpositive capital: 9

- Capital spending / revenue: 0.3%

- ROIC including acquisitions, ten-year median: -371.8%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: -40.4%

- FY2017: -73.9%

- FY2018: -30.6%

- FY2019: -266.7%

- FY2020: -28.3%

- FY2021: -53.5%

- FY2022: -77.4%

- FY2023: -73.5%

- FY2024: -679.7%

- FY2025: -100.3%

### economics: fail

- owner earnings cash conversion below threshold

- incremental invested capital return below threshold

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: -$572M

- Net income, five-year total: -$572M

- Return on incremental invested capital: -294.7%

- Working capital / revenue, annual change: 34.0 pp

Chart: Owner earnings · five years; fiscal year observations.

- FY2021: -$71M

- FY2022: -$74M

- FY2023: -$87M

- FY2024: -$131M

- FY2025: -$209M

### management: fail

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- buybacks leaned toward cheaper years (informational)

- ROIC first 3 years vs last 3 years: -40.4% vs -100.3%

- Per-share earnings: -19.32 to -3.66 (three-year endpoint medians)

- per-share value declined or ends nonpositive

- five-year and ten-year diluted share growth both above threshold

- acquired goodwill and intangibles (proxy) exceeds half of ten-year net income with low and deteriorating ROIC

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: 36.9%

- Ordinary dilution, 5-year annual growth: 40.2%

- Market cap gain: $597M

- Cumulative retained earnings: -$930M

- Diluted shares, 10-year annual growth: 36.9%

- Diluted shares, 5-year annual growth: 40.2%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value change: $15.67

- Per-share value, starting three-year median: -$19.32

- Per-share value, ending three-year median: -$3.66

- Buybacks concentrated in cheaper years (correlation): 0.50

- Average buyback yield: 1.5%

- Buyback history: 3 years

- Debt-funded buybacks: No

- Acquisition spending: $38M

- Cumulative net income, 10 years: -$966M

- ROIC, first three-year median: -40.4%

- ROIC, last three-year median: -100.3%

Chart: Earnings per share; fiscal year observations.

- FY2016: -$11.82

- FY2017: -$21.18

- FY2018: -$12.54

- FY2019: -$24.01

- FY2020: -$5.30

- FY2021: -$4.90

- FY2022: -$4.57

- FY2023: -$3.96

- FY2024: -$3.66

- FY2025: -$3.02

### accounting: pass

- latest-year receivables to sales index (DSRI) exceeds 1.465

- Sloan accruals: -29.2%

- Receivables to sales index (DSRI): 14.25×

- Restructuring years, last five: 0

- Earnings backed by cash: Yes

- Accounting red flags: 1

- Goodwill and intangibles / equity: 0.29×

Chart: Sloan accruals; fiscal year observations.

- FY2016: -8.3%

- FY2017: -11.7%

- FY2018: 0.8%

- FY2019: -7.4%

- FY2020: -22.2%

- FY2021: -16.3%

- FY2022: -10.7%

- FY2023: -0.6%

- FY2024: -25.5%

- FY2025: -29.2%

## Holders

- [Robert Torray](https://gigainvestors.com/T): tracked 13F investor; follow the investor page for holding quarter and amounts.

## Price story

Down 26% since Feb 2024 · sales +209.1%

Story as of 2026-10-16T09:59:49.798Z; price observation 2026-10-15.

- 2025-08-08: Earnings call transcript: Verastem Q2 2025 sees revenue growth and FDA approval ([investing.com](https://www.investing.com/news/transcripts/earnings-call-transcript-verastem-q2-2025-sees-revenue-growth-and-fda-approval-93CH-4179592))

### Sales · FY2024–2025

sales +209.1%; source https://www.sec.gov/Archives/edgar/data/1526119/000110465926023444/vstm-20251231x10k.htm; observed 2026-03-04.

- FY2016: $0 

- FY2017: $0 

- FY2018: $27M 

- FY2019: $17M 

- FY2020: $89M 

- FY2021: $2.1M 

- FY2022: $2.6M 

- FY2023: $0 

- FY2024: $10M 

- FY2025: $31M 

### Gross margin · FY2025

gross margin 82.9%; source https://www.sec.gov/Archives/edgar/data/1526119/000110465926023444/vstm-20251231x10k.htm; observed 2026-03-04.

- FY2018: 97.8% 

- FY2019: 83.9% 

- FY2020: 61.9% 

- FY2025: 82.9% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in biotechnology; annual sales are USD 30.9 million.

- Source: https://www.sec.gov/Archives/edgar/data/1526119/000110465926023444/vstm-20251231x10k.htm (filed 2026-03-04); FY2025: revenue 30914000; grossProfit 25616000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-05); VSTM.US: Verastem, Inc., a development-stage biopharmaceutical company, focuses on developing and commercializing drugs for the treatment of cancer in the United States. Its product candidates are Avutometinib, which is an orally administered, small molecule dual RAF/MEK inhibitor developed to block MEK kinase activity and the compensatory reactivation of MEK by upstream RAF, thereby targeting the RAS/MAPK signaling pathway that is commonly activated in various cancers; and Defactinib, an oral small molecule inhibitor of FAK and proline-rich tyrosine kinase for various solid tumors. The company is involved in clinical studies, including RAMP 301, a randomized global confirmatory trial to evaluate the combination of Avutometinib and Defactinib for the treatment of patients with recurrent low-grade serous ovarian cancer; RAMP 201, an adaptive two-part multicenter, parallel cohort, randomized open label trial to evaluate the efficacy and safety of Avutometinib and in combination with Defactinib; and FRAME, an investigation of Avutometinib and Defactinib in patients with KRAS mutant cancers and subsequent analyses; and RAMP 205. It has license agreements with Chugai Pharmaceutical Co., Ltd. for the development, commercialization, and manufacture of products containing Avutometinib; and Pfizer Inc. to research, develop, manufacture, and commercialize products containing Pfizer's inhibitors of FAK for therapeutic, diagnostic, and prophylactic uses in humans. In addition, it has a clinical collaboration agreement with Amgen, Inc. to evaluate the combination of Avutometinib with Amgen's KRAS-G12C inhibitor LUMAKRAS, which in Phase 1/2 trial entitled RAMP 203; VS-7375, and VS-7375-101 is a discovery and development collaboration with GenFleet Therapeutics to advance new programs targeting RAS pathway-driven cancers; and AVMAPKI, FAKZYNJA, CO-PACK, is an avutometinib capsules, and defactinib tablets. The company was incorporated in 2010 and is headquartered in Needham, Massachusetts.

### Why customers stay

It lost 73.7% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-04); 10-year return on capital observations [[2016,-0.4043263205942155],[2017,-0.7387075242718446],[2018,-0.3059364989867294],[2019,-2.667076275510204],[2020,-0.28294948263601666],[2021,-0.5346445299154718],[2022,-0.7738829644353712],[2023,-0.7353242158676249],[2024,-6.797039143776663],[2025,-1.0025354686637526]]; median -0.7370158700697347. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid dividends in 1 of 10 years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-04); Dividend observations: [[2016,0],[2017,0],[2018,0],[2019,15000],[2020,0],[2021,0],[2022,0],[2023,0],[2024,0],[2025,0]]. Zero only counted when supported by a complete cash-flow statement.

### Are managers owners

Insiders own 1% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-05); VSTM.US SharesStats.PercentInsiders = 1.02 percentage points; cache date 2026-10-05.

### What the price says

The price is 20.7 times annual sales; cash earnings are negative.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-04); Closing price 9.23 USD; reporting-to-trading FX 1; FY2025 annual sales per share 0.4460315399154511; price multiple 20.69360386879731. FY2025 cash earnings/share -3.022277049156675. Closing-price date 2026-10-15.

## Monthly share-price history (USD per share)

- 2016-10: $1.25 per share

- 2016-11: $1.14 per share

- 2016-12: $1.12 per share

- 2017-01: $1.27 per share

- 2017-02: $1.14 per share

- 2017-03: $2.07 per share

- 2017-04: $1.94 per share

- 2017-05: $2.06 per share

- 2017-06: $2.18 per share

- 2017-07: $3.63 per share

- 2017-08: $3.90 per share

- 2017-09: $4.70 per share

- 2017-10: $3.82 per share

- 2017-11: $4.21 per share

- 2017-12: $3.07 per share

- 2018-01: $3.55 per share

- 2018-02: $3.06 per share

- 2018-03: $2.98 per share

- 2018-04: $4.17 per share

- 2018-05: $5.59 per share

- 2018-06: $6.88 per share

- 2018-07: $7.70 per share

- 2018-08: $9.96 per share

- 2018-09: $7.25 per share

- 2018-10: $5.07 per share

- 2018-11: $5.10 per share

- 2018-12: $3.36 per share

- 2019-01: $3.28 per share

- 2019-02: $3.01 per share

- 2019-03: $2.96 per share

- 2019-04: $2.13 per share

- 2019-05: $1.32 per share

- 2019-06: $1.51 per share

- 2019-07: $1.50 per share

- 2019-08: $1.26 per share

- 2019-09: $1.21 per share

- 2019-10: $1.09 per share

- 2019-11: $1.37 per share

- 2019-12: $1.34 per share

- 2020-01: $1.88 per share

- 2020-02: $2.79 per share

- 2020-03: $2.64 per share

- 2020-04: $1.89 per share

- 2020-05: $1.86 per share

- 2020-06: $1.72 per share

- 2020-07: $1.34 per share

- 2020-08: $1.26 per share

- 2020-09: $1.21 per share

- 2020-10: $1.20 per share

- 2020-11: $2.01 per share

- 2020-12: $2.13 per share

- 2021-01: $1.95 per share

- 2021-02: $2.35 per share

- 2021-03: $2.47 per share

- 2021-04: $3.07 per share

- 2021-05: $3.87 per share

- 2021-06: $4.07 per share

- 2021-07: $3.23 per share

- 2021-08: $2.65 per share

- 2021-09: $3.08 per share

- 2021-10: $2.60 per share

- 2021-11: $2.67 per share

- 2021-12: $2.05 per share

- 2022-01: $1.53 per share

- 2022-02: $1.20 per share

- 2022-03: $1.41 per share

- 2022-04: $1.42 per share

- 2022-05: $1.28 per share

- 2022-06: $1.16 per share

- 2022-07: $1.07 per share

- 2022-08: $1.16 per share

- 2022-09: $0.85 per share

- 2022-10: $0.42 per share

- 2022-11: $0.46 per share

- 2022-12: $0.40 per share

- 2023-01: $0.65 per share

- 2023-02: $0.52 per share

- 2023-03: $0.42 per share

- 2023-04: $0.39 per share

- 2023-05: $1.02 per share

- 2023-06: $7.44 per share

- 2023-07: $11.06 per share

- 2023-08: $9.76 per share

- 2023-09: $8.13 per share

- 2023-10: $6.28 per share

- 2023-11: $6.89 per share

- 2023-12: $8.14 per share

- 2024-01: $11.75 per share

- 2024-02: $12.46 per share

- 2024-03: $11.80 per share

- 2024-04: $9.98 per share

- 2024-05: $3.96 per share

- 2024-06: $2.98 per share

- 2024-07: $2.60 per share

- 2024-08: $2.50 per share

- 2024-09: $2.99 per share

- 2024-10: $3.76 per share

- 2024-11: $5.34 per share

- 2024-12: $5.17 per share

- 2025-01: $6.08 per share

- 2025-02: $5.60 per share

- 2025-03: $6.03 per share

- 2025-04: $7.49 per share

- 2025-05: $7.52 per share

- 2025-06: $4.15 per share

- 2025-07: $6.17 per share

- 2025-08: $9.25 per share

- 2025-09: $8.83 per share

- 2025-10: $9.45 per share

- 2025-11: $10.64 per share

- 2025-12: $7.72 per share

- 2026-01: $6.10 per share

- 2026-02: $5.72 per share

- 2026-03: $5.30 per share

- 2026-04: $5.46 per share

- 2026-05: $4.33 per share

- 2026-06: $3.82 per share

- 2026-07: $5.80 per share

- 2026-08: $7.22 per share

- 2026-09: $8.05 per share

- 2026-10: $9.23 per share

## Annual estimated value (USD per share)

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

[Original 10-K filing](https://www.sec.gov/Archives/edgar/data/1526119/000110465926023444/vstm-20251231x10k.htm); period 2025-12-31, filed 2026-03-04.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.