TRVI

We rate Trevi Therapeutics, Inc. (TRVI) as a Reduce with a composite score of 47.0/100 at a current price of $11.25. The quantitative profile shows weakness across multiple dimensions, suggesting limited upside potential and elevated risk of underperformance relative to peers over the next 12 months.

The rating is primarily driven by strength in momentum (73th percentile) and stability (63th percentile), which together account for the majority of the composite score. Offsetting weakness in investment (25th percentile) and quality (32th percentile) tempers our overall conviction. We assign a No Moat rating (20/100), Low uncertainty, and Poor capital allocation.

Key items to watch: quarterly earnings execution and sector-level competitive dynamics. Any material change in these dynamics could warrant a reassessment of our rating. The moat trend is stable, which suggests the competitive landscape is stable for now.

Trevi Therapeutics, 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 47.0/100 places it at rank #2491 in our full 7,333-stock universe. At $1.1B in market capitalization, Trevi Therapeutics, Inc. is a small-cap player in the Manufacturing space, which limits certain scale advantages but may allow for more agile strategic execution.

Momentum indicators (73th percentile) are constructive regarding the near-term price trend. Revenue growth data is unavailable, limiting our ability to confirm whether momentum is fundamentally supported.

Margin data is not available for Trevi Therapeutics, Inc., which limits our assessment of the company's cost structure and operating efficiency. We rely on factor-based signals to infer business quality in the absence of detailed margin data.

At a current price of $11.25, Trevi Therapeutics, Inc. is trading near fair value based on current fundamentals. Our value factor score of 47/100 reflects a composite assessment across multiple valuation metrics including price-to-earnings, price-to-book, EV/EBITDA, and price-to-sales ratios relative to both sector peers and the broader market. Valuation metrics are mixed, with no strong signal of mispricing in either direction.

The stock currently trades at P/B of 7.2x. We evaluate these multiples in the context of both absolute levels and sector-relative positioning to form our valuation view.

We assign a Low uncertainty rating to Trevi Therapeutics, Inc.. The company exhibits strong financial stability with a beta of 0.29, conservative leverage (5% D/E), and a stability factor in the 63th percentile. The predictable nature of the business model and solid financial position reduce the range of potential outcomes, giving us confidence in our fair value estimate.

Specific risk factors that inform our assessment include: weak quality scores (32th percentile); low beta of 0.29 — while defensive, this may indicate limited upside participation in bull markets. Each of these factors independently widens the distribution of potential outcomes, and in combination they create a risk profile that demands careful position sizing. The stability factor at the 63th percentile and quality factor at the 32th percentile provide a quantitative summary of the overall risk landscape.

Key risk mitigants include: conservative leverage (5% D/E) limits balance sheet risk; above-average stability (63th percentile) suggests predictable business dynamics. These factors partially offset the identified risks and provide downside protection in adverse scenarios. On balance, the risk-reward profile is favorable for long-term investors.

We rate Trevi Therapeutics, Inc.'s capital allocation as Poor. Key concerns include low returns on equity (-25.1%), weak asset returns (ROA -23.9%). Exemplary capital allocators generate ROE above 20% and maintain conservative leverage — Trevi Therapeutics, Inc. significantly underperforms these benchmarks, raising questions about management's ability to create shareholder value.

Investors should scrutinize management's reinvestment decisions and balance sheet trajectory before committing capital. Poor capital allocation often compounds over time: overlevered balance sheets limit strategic flexibility, while low returns on capital destroy shareholder value. We would need to see sustained improvement in profitability metrics and balance sheet discipline before considering an upgrade.

In summary, Trevi Therapeutics, Inc. receives a Reduce rating with a composite score of 47.0/100 (rank #2491 of 7,333). Our quantitative framework assigns a No Moat (20/100, trend: stable), Low uncertainty, and Poor capital allocation. The average factor score across quality, value, momentum, stability, and investment is 48/100.

Our analysis does not support a constructive view on Trevi Therapeutics, Inc. at this time. The combination of limited competitive advantages, low uncertainty, and poor capital allocation suggests unfavorable risk-reward at current levels. We recommend investors avoid new positions and existing holders consider reducing exposure.