In this series I will continue discussing companies that is considered the best choice for investment during this period of time where no one knows where is the market heading next.
AbCellera is a technology company that searches, decodes, and analyzes natural immune systems to find antibodies that its partners can develop into drugs to prevent and treat disease. From July 2020 until now its share prices dropped from 58$ until it reached to 9$. When analyzing the company financial statement , it appears that the company made high Return On Invested Capital (ROIC) greater than its peers as well as the industry in general, which made it create more value for the investors based in the free cash flow it generate that is the amount of money that left after paying all expenses and left for all the lenders and equity holders as shown below:
The ABCL created only negative ROIC in 2019, but immediately after one year the company increases its ROIC from -3% to 25%. The high ROIC which ABCL made, allow it to increase its value which lead to generate high free cash flow during the 2020 and 2021 as shown below:
The company was able to increase its Free cash flow by more than 997.5% in 2020, and in 2021 the company was still able to increase its free cash flow to 80% from 2020 and 1795% from 2019.
Based on the two major criteria that investors are looking for which is Return on Invested capital and Free cash flow, I believe ABCL considered the best choice for those who want to invest in stock market for at less 3 ears.