Burning Rock Biotech Limited

AI-generated fair value estimate for this company.

Method: 10-year unlevered FCF DCF: FY2025A/2026E revenue base of ~$75M USD (FY2025 revenue RMB539.6M / ~$77M); revenue growth tapering from 2% (Y1) to 5% (Y6-10), reflecting Q2 2026 YoY revenue decline of 9.3% offset by in-hospital segment growth (+7.4%) and new product launches (OncoScreen BCMatch, CanCatch); FCF margin ramping from -3% to 6% of revenue as opex leverage improves from FY2025's near-breakeven operating cash flow; discount rate 15% (China ADR/VIE governance and delisting risk plus small-cap execution risk); terminal growth 3%; EV of ~$26.7M plus net cash of ~$55M ($5.2/share, cash $61.8M less debt ~$7M) added at face value.

Reasoning: Burning Rock has real, substantial revenue (~$75-77M) with high gross margins (70-75%) and a demonstrated, if uneven, path toward operating cash flow breakeven, so a standard FCF DCF is appropriate unlike a pre-revenue biotech; a high discount rate and conservative growth/margin ramp were used given 2026 revenue deceleration, thin FCF history, and elevated China-ADR risk, with the large net cash position explicitly floored into the value.