DCF Valuation Model for Invex Therapeutics, page-107

Thanks for sharing your workings, CD. 41% EBIT margin makes sense, however from a DCF perspective, I'd add some level of risk (safety) to account for the fact that 'surprise' costs can always arise. It's not very common for a pharma business to produce +40% margins YoY consistently - it requires a lot to go right. The variability of Pfizer and Sanofi's EBIT margins YoY quite neatly illustrate this. I'd build ~500bps of EBIT margin hurt to account for the unknown risk factors.

On Contract Manufacturing margins, 20.5% is at the higher range. CM is generally a low margin business. One key driver tends to be the CM generally producing for a larger global business like GSK, J&J, erc. However, for Invex - Peptron, this is not really the case - hence higher margins for the CM may be supported. Peptron owning some relevant IP also helps, but only to an extent as Invex could look elsewhere and ultimately develop the same drug.

Separately, Silverstein - I didn't revert earlier on your question, but yes - I do have some working-professional friends/mentors who leverage Technicals along with other quantitative techniques / macro/geo-political analysis. I'm of course not aware of their running PnLs, but it's been sufficient to afford them relatively continued employment at the likes of DBS, Citi, etc. In any case, my point was not that Technicals should be leveraged as a sole trading strategy - rather it can be used supplementary - particularly for more liquid securities.