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Verdict
Quantitative factor alignment verified for current market regime.
Quant Score
Rank
#1344
Positioning
Market Dominance
Manufacturing
Pharmaceutical Products
$2.3B
Todd F. Watanabe
Arcutis Biotherapeutics, Inc., a biopharmaceutical company, focuses on developing and commercializing treatments for dermatological diseases. Its lead product candidate is a topical roflumilast cream that has completed Phase III clinical trials for the treatment of plaque psoriasis and atopic dermatitis. The company is also developing ARQ-154, a topical foam formulation of arq-154.
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X-AXIS: EV/EBITDA (LOWER = CHEAPER) | Y-AXIS: ROE (HIGHER = ELITE) | RED CIRCLE = ARQT ANALYSIS TARGET
| Stock | Rating | Score▼ | Quality | Value | Momentum | P/E | EV/EBITDA | ROE | ROA | Gross Mgn | Op Mgn | Net Mgn | Rev Growth | Div Yield | D/E | Mkt Cap | AUDIT |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
$UL UNILEVER PLC | 78 | 96 | 98 | 59 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$ASML ASML HOLDING NV | 77 | 89 | 86 | 83 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$ESLT ELBIT SYSTEMS LTD | 76 | 81 | 87 | 85 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$MT ArcelorMittal | 75 | 71 | 98 | 85 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$AMAT APPLIED MATERIALS INC /DE | 75 | 85 | 87 | 84 | 20.9x | 13.6x | 32.9% | 20.5% | 48.8% | 30.6% | 24.4% | 7.7% | 0.9% | 32.0x | $148.6B | VS | |
$SIMO Silicon Motion Technology CORP | 75 | 84 | 86 | 85 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$CODA Coda Octopus Group, Inc. | 74 | 83 | 90 | 79 | 16.3x | 11.9x | 7.4% | 7.5% | 68.3% | 19.5% | 18.2% | 29.0% | 0.0% | 0.0x | $84M | VS | |
$GSK GSK plc | 74 | 84 | 90 | 70 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$EFXT Enerflex Ltd. | 74 | 80 | 91 | 83 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$BUD Anheuser-Busch InBev SA/NV | 74 | 84 | 97 | 63 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$ARQT Arcutis Biotherapeutics, Inc. | 54 | 69 | 54 | 71 | 438.5x | 94.5x | -47.5% | -20.2% | 89.1% | -33.5% | -35.7% | 221.5% | 0.0% | 69.0x | $2.3B | ||
| SECTOR BENCH | - | - | - | - | - | 22.3x | 11.5x | -1.9% | 0.9% | 44.1% | 2.5% | 1.0% | 6.7% | 0.0% | 0.2x | - | REF |
Arcutis Biotherapeutics, Inc. (ARQT) receives a "Hold" rating with a composite score of 54.4/100. It ranks #1344 out of 7,333 stocks in our coverage universe and carries a 3-star rating. Ratings are driven by a 6-factor quantitative model measuring quality, value, momentum, investment, stability, and short interest.
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Outperforming peers — winners tend to keep winning over 3-12 months
Fair valuation relative to peers
High profitability & efficiency — strong quality floor supports entry
Average volatility — neutral timing signal
Aggressive spending — empire-building risk, dilutive growth
Mid-range overall rating
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Relative valuation derived from Manufacturing sector benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Re-calculated daily.
Projection based on user-defined inputs. Re-calculated daily against current market data.
Reverse DCF Framework — Mauboussin Methodology
Institutional-grade Reverse DCF analysis. This model identifies the growth hurdles embedded in current market prices. When implied growth is significantly lower than historical or projected rates, a margin of safety may exist. Re-audited daily.
No analyst ratings for ARQT.
View All RatingsROIC 13.7% vs WACC 9.5% (spread +4.2%)
GM 89% vs sector 44%, OM -33% vs sector 3%
Capital turnover 1.62x, R&D intensity 23.0%
Rev growth 222%, 6yr history
Interest coverage 2.8x, Net debt/EBITDA 7.2x
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation and elite competitive moats.
Profit generated per dollar of shareholder equity
Efficiency of asset utilization
Pricing power and cost efficiency
Core business profitability
Bottom-line profitability
The Quality factor evaluates the persistence and magnitude of realized cash flows. Companies with scores >70 exhibit superior pricing power and structural financial resilience through diverse economic regimes.
Our uncertainty rating tracks the predictability of future cash flows and potential for permanent capital loss. Moderate visibility with standard industry cyclicality.
We rate Arcutis Biotherapeutics, Inc. (ARQT) as a Hold with a composite score of 54.4/100 at a current price of $26.99. The stock presents a mixed quantitative picture — neither compelling enough to warrant new accumulation nor weak enough to justify selling.
Arcutis Biotherapeutics, Inc. holds a top-quartile position (#0 of 50) within the Manufacturing sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 54.4/100 places it at rank #1344 in our full universe.
The near-term outlook is constructive, with revenue growing at 222% and momentum in the 71th percentile confirming positive market sentiment. The combination of strong top-line growth and favorable price dynamics suggests the company is executing well on its growth strategy.
Narrow
High
Poor
Fair Value
Gross margins of 89% signal strong pricing power.
Positive momentum indicates institutional accumulation.
Stable competitive position in a defensive sector.
Elevated P/E ratio of 438.5x leaves little room for execution misses.
Vulnerability to macroeconomic shocks and interest rate volatility.
Arcutis Biotherapeutics, Inc. represents a hold based on multi-factor quantitative performance.
Our model assigns Arcutis Biotherapeutics, Inc. a Hold rating, with a composite score of 54.4/100 and 3 out of 5 stars. Ranked #1344 of 7,333 stocks, ARQT presents a mixed quantitative picture — neither compelling enough to initiate new positions nor weak enough to warrant selling. Investors already holding may consider maintaining their position while monitoring for changes in the factor profile.
ARQT earns a quality score of 69/100, indicating above-average business quality. The company reports a return on equity of -47.5% (sector avg: -1.9%), gross margins of 89.1% (sector avg: 44.1%), net margins of -35.7% (sector avg: 1.0%). Companies in this tier generally demonstrate consistent profitability and efficient capital deployment, though they may face some competitive pressure.
ARQT's value score of 54/100 indicates the stock is fairly valued based on its current fundamentals. Key valuation metrics include a P/E ratio of 438.50x, an EV/EBITDA of 94.48x, a P/B ratio of 19.70x. At this level, neither a clear bargain nor overpriced, the stock's attractiveness depends more on forward growth expectations and qualitative factors.
Arcutis Biotherapeutics, Inc.'s investment score of 24/100 suggests limited reinvestment activity. Key growth metrics include revenue growth of 221.5% vs. a sector average of 6.7% and a return on assets of -20.2% (sector: 0.9%). While this can be positive for mature, cash-generative businesses returning capital to shareholders, it may also signal a lack of growth opportunities or management conservatism.
ARQT shows strong momentum characteristics with a score of 71/100. The stock has been trending above key moving averages, indicating solid demand from institutional buyers. Revenue growth stands at 221.5% year-over-year, while a beta of 1.11 reflects its sensitivity to broader market moves. This level of momentum typically signals sustained investor confidence and favorable near-term price action.
With a stability score of 57/100, ARQT exhibits average financial resilience. Key stability metrics include a beta of 1.11 and a debt-to-equity ratio of 69.00x (sector avg: 0.2x). While the balance sheet is not a major concern, the stock is subject to typical market volatility and may experience sharper drawdowns during risk-off episodes.
Arcutis Biotherapeutics, Inc.'s short interest score of 16/100 reveals significant bearish positioning, suggesting institutional investors are actively betting against the stock. Specific risk factors include elevated leverage (D/E: 69.00x). At $2.3B (mid-cap), ARQT carries meaningful risk and is best suited for investors with high risk tolerance who have thoroughly evaluated the bear thesis.
Arcutis Biotherapeutics, Inc. is a mid-cap company in the Manufacturing sector, ranked #0 of 50 in its sector (100th percentile) and #1344 of 7,333 overall (82nd percentile). Key comparisons include ROE of -47.5% trailing the -1.9% sector median and operating margins of -33.5% below the 2.5% sector average. This top-quartile standing reflects exceptional competitive strength relative to Manufacturing peers.
While ARQT currently exhibits a HOLD profile, superior opportunities exist within the MANUFACTURING sector. Our model identifies several "Strong Buy" candidates with higher quality scores and more attractive valuations among direct industry competitors.
View Top Manufacturing Alpha →Quant Factor Profile
Key factor gap
Momentum (71) vs Short Int. (16) — closing this gap could shift the rating.
EV/EBITDA 724% ABOVE SECTOR MEDIAN
ROE 2399% ABOVE SECTOR MEDIAN (FAVORABLE)
Gross Margin 102% ABOVE SECTOR MEDIAN (FAVORABLE)
Above 50MA
37.18%
Net New Highs
+51081
Suvretta Capital Management sold nearly 1.1 million shares of Arcutis Biotherapeutics (ARQT) during Q3, reducing its position by $35.78 million. Despite the sale, ARQT remains the fund's largest holding worth $197.51 million. The stock has doubled in value over the past year, significantly outperforming the S&P 500. The sale appears to be a risk management decision following the dramatic stock appreciation rather than a loss of conviction in the company's fundamentals.
Castle Biosciences (CSTL) possesses the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.
Tejara Capital exited its entire position in Arcutis Biotherapeutics, selling 520,503 shares for approximately $9.81 million in February 2026. The stock has surged 99.1% over the past year, driven by strong Q3 results showing net product revenue more than doubling year-over-year. The fund's exit appears to be risk management after the sharp Q4 rally rather than a bearish signal, as the company maintains confidence in its commercial trajectory with 2026 guidance of $455-470 million in net product sales.