Arcutis Biotherapeutics, Inc. (ARQT) - Stock Analysis
Last updated: Jan 19, 2026
Research Idea
Research content for general circulation. Not individualized advice. Methodology & Disclosures
Compelling short-term growth supported by strong Q3 revenue growth (+122% YoY), recent FDA pediatric approvals, upcoming Phase 2 topline data in Q1 2026, solid profitability trends, strong liquidity with $191M cash, and a 20% price surge with bullish technical momentum.
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AI Analyst Overview
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Valuation Metrics
Fundamental Analysis
Key Financial Insights: ⢠Profitability improving ⢠Cash conversion risk ⢠Receivables concentration ARQT shows improving profitability with positive operating and net income and very high gross margins, but fragile cash conversion, oversized receivables, meaningful long-term debt against a large accumulated deficit, and a richly valued stock that leaves little margin for error.
Price Behavior
Key Price Behavior Insights: ⢠Lower highs/lows ⢠Broke support ⢠Gradual decline Support Level: $19.64 Resistance Level: $28.50 (also near $30.00) ARQT is in a clear downtrend over the last month, sliding from about $29.88 to $25.85 and breaking below $28.50 (failed to hold $30.00), with gradual selling pressure but no sharp oversold washoutâwatch for reclaiming $28.50 to signal momentum shift.
Sentiment & News
Key News Insights: ⢠Insider selling ⢠ZORYVE guidance ⢠Pipeline expansion Despite late-2025/early-2026 insider and institutional share sales, Arcutis forecasts robust 2026 ZORYVE sales ($455â470M), a shift to positive cash flow and continued clinical expansion of its pipeline.
AI Summary
Arcutis has shifted from a capitalâhungry biotech to a commercializationâled growth story where ZORYVE's strong topline trajectory and ~91% gross margins give a credible path to positive cash flow in 2026, so execution on sales, payer access, and label expansions is now the primary value driver. Monitor receivables turnover/GTN normalization, quarterâtoâquarter free cash flow, and script growth (especially payer stepâtherapy wins and pediatric uptake) â any sustained weakness there would rapidly compress the rich valuation.
Description
Arcutis Biotherapeutics is a clinical-stage biopharmaceutical company developing topical treatments for dermatological conditions. Its lead asset is a roflumilast cream that has completed Phase III trials for plaque psoriasis and atopic dermatitis, and its pipeline includes additional roflumilast and topical JAK1 inhibitor formulations targeting scalp and skin disorders such as seborrheic dermatitis, hand eczema, vitiligo and alopecia areata. The company was incorporated in 2016, changed its name in October 2019, and is headquartered in Westlake Village, California.
Idea History
| Date | Close | Ticker | Company | Summary | Status | P/L |
|---|---|---|---|---|---|---|
| Dec 2 | Dec 9 | ARQT | Arcutis Biotherapeutics, Inc. | Compelling short-term growth supported by strong Q3 revenue growth (+122% YoY), recent FDA pediatric approvals, upcoming Phase 2 topline data in Q1 2026, solid profitability trends, strong liquidity with $191M cash, and a 20% price surge with bullish technical momentum. | Closed | +1.1% |