Breaking Down Rafael Holdings, Inc. (RFL) Financial Health: Key Insights for Investors

You're looking at Rafael Holdings, Inc. (RFL) and seeing the classic biotech risk-reward profile, a company that's all about the clinical pipeline, not current revenue. Honestly, the financials for the full fiscal year 2025, which ended July 31, tell a clear capital-intensive story: the net loss attributable to the company was $30.5 million, or $1.04 per share, a necessary burn rate that reflects their strategic pivot into rare disease therapeutics. The good news is they shored up the balance sheet, closing a $25 million rights offering in June 2025, which boosted their cash and cash equivalents to a solid $52.8 million as of July 31, 2025. That capital is defintely needed, considering R&D expenses soared to $12.8 million for the year as they integrated Cyclo Therapeutics and pushed their lead candidate, Trappsol® Cyclo™, deeper into its pivotal Phase 3 trial. This is a high-stakes, binary-outcome play, so you need to understand where that $52.8 million runway ends and what the potential upside looks like after the stock's massive 136.8889% single-day surge on November 14, 2025.

Revenue Analysis

You're looking at Rafael Holdings, Inc. (RFL) and trying to figure out where the money actually comes from, which is the right place to start for a company in a transitional phase. The direct takeaway is this: RFL's revenue is small but growing, driven almost entirely by its strategic shift into the Healthcare segment, specifically product sales from its recent acquisition.

For the fiscal year ending July 31, 2025, Rafael Holdings, Inc. reported total annual revenue of $917,000. That's a significant jump, reflecting a year-over-year (YoY) revenue growth rate of 43.96% compared to the $637,000 reported in fiscal year 2024. This kind of percentage growth looks great on paper, but remember, we are starting from a very low base. It's a sign of momentum, defintely, but not yet scale.

The company operates across three reportable segments, but the revenue contribution is heavily weighted toward one, which is a key change for investors to note:

• Healthcare: Focused on pharmaceuticals and medical devices, primarily through the newly consolidated Cyclo Therapeutics.
• Infusion Technology: Deals with technology for enhancing product offerings for third-party manufacturers, mainly via Day Three Labs.
• Real Estate: Holds commercial real estate assets in the US and Israel.

The Healthcare segment is the new engine. This segment alone generated approximately $515,000 in revenue for the 2025 fiscal year, which means it contributed about 56.16% of the total top line. Here's the quick math: the remaining segments (Infusion Technology and Real Estate) combined for about $402,000 in revenue. The Healthcare revenue is largely product revenue from Trappsol® Cyclo™, a key candidate for Niemann-Pick Disease Type C1 (NPC1).

The most significant change in the revenue structure for Rafael Holdings, Inc. is the March 2025 merger with Cyclo Therapeutics. This strategic move fundamentally transformed the company from a holding company with passive interests to one actively focused on a lead clinical program. The Healthcare segment's revenue was flat year-over-year if you look at the raw numbers, but the consolidation of Cyclo and the activity of other entities like Cornerstone Pharmaceuticals and Day Three Labs are what drove the overall 43.96% growth in total revenue. The revenue is now directly tied to the commercialization of a rare disease drug, which is a much different risk profile than holding real estate.

To see the full picture of the company's financial shift, you need to look beyond just the top line. Check out the rest of the analysis in Breaking Down Rafael Holdings, Inc. (RFL) Financial Health: Key Insights for Investors.

Here's a quick summary of the segment contributions for the fiscal year 2025 to keep it clear:

Your next step should be to track the Phase 3 clinical trial progress for Trappsol® Cyclo™; that's where the real future revenue potential is locked up.

Profitability Metrics

You're looking at Rafael Holdings, Inc. (RFL) and seeing a biotech company in the heavy-spending, clinical-trial phase, so you have to adjust your profitability expectations. The core takeaway is that while the company's gross margin looks decent for a product-based business, the massive investment in Research and Development (R&D) and General and Administrative (G&A) expenses drives all other margins deep into negative territory. This is defintely a classic early-stage biotech profile.

For the fiscal year ended July 31, 2025, Rafael Holdings, Inc. (RFL) reported a net loss of $30.5 million. The company's revenue for the same period was only $917,000, which means the business is overwhelmingly funded by capital raises, not sales.

Here is the quick math on the key profitability ratios for FY 2025, compared to the industry average for Biotechnology, which is a better benchmark than its legacy real estate holdings:

The gross profit margin of 52.67% (calculated from a gross profit of $483,000 on $917,000 in revenue) shows that for the limited revenue Rafael Holdings, Inc. (RFL) generates, its cost of goods sold (COGS) is managed reasonably well. But that's the only positive on the income statement.

The massive negative operating and net margins tell the real story of operational efficiency-or lack thereof, which is expected in this sector. The company's total operating expenses, driven by R&D and G&A, ballooned to $26.6 million ($12.8 million in R&D and $13.8 million in G&A). This spending is why the operating margin is so deeply negative, far exceeding the industry's already negative average of -150.8%. The R&D increase, specifically, from $4.2 million in FY 2024 to $12.8 million in FY 2025, is primarily due to the March 2025 acquisition and consolidation of Cyclo Therapeutics, which is advancing the pivotal Phase 3 TransportNPC™ study.

Looking at trends, the net loss actually improved slightly from $34.4 million in fiscal year 2024 to $30.5 million in fiscal year 2025. What this estimate hides is that the core operating burn rate-the R&D and G&A expenses-is accelerating, reflecting the company's strategic pivot to focus on clinical development. This is a deliberate, high-risk, high-reward strategy. You are investing in future potential, not current profitability. For more on the company's direction, check out their Mission Statement, Vision, & Core Values of Rafael Holdings, Inc. (RFL).

• Monitor R&D spending for Phase 3 milestones.
• Expect negative margins until drug approval.
• Compare cash burn to $52.8 million cash on hand.

The key action for an investor is to stop focusing on traditional profitability metrics and start tracking clinical trial progress and cash runway, because that is what will drive value here.

Debt vs. Equity Structure

You're looking at Rafael Holdings, Inc. (RFL) and trying to figure out how they fund their operations, which is defintely the right first step. The short answer is: they are an equity-heavy biotech firm. They rely almost entirely on shareholder capital, not borrowed money, for their clinical-stage growth.

As of the end of their fiscal year on July 31, 2025, Rafael Holdings' balance sheet shows a remarkably low reliance on debt. The company reported total debt of just $0.69 million. Compare that to their total shareholder equity, which stood at a robust $98.4 million. Here's the quick math on that capital structure:

• Total Debt: $0.69 million
• Total Equity: $98.4 million
• Debt-to-Equity (D/E) Ratio: 0.7%

That 0.7% Debt-to-Equity ratio is extremely conservative. For context, the average D/E ratio for the Biotechnology sector is around 0.17 (or 17%), and for Pharmaceuticals, it can range higher, up to 0.854 (or 85.4%). Rafael Holdings is operating with virtually no financial leverage (using debt to amplify returns), which is typical for a clinical-stage biotech focused on high-risk, high-reward drug development like their lead candidate, Trappsol® Cyclo™.

This capital structure tells you the company is balancing its financing through equity funding. They don't have a credit rating because they don't have meaningful debt to rate. This approach keeps interest expense low, but it means they must consistently raise capital from investors to fund their R&D expenses, which were $12.8 million for the full fiscal year 2025.

The most concrete example of this equity-first strategy is their recent financing activity. To shore up their cash position and fund the pivotal Phase 3 TransportNPC™ study, Rafael Holdings successfully completed a $25.0 million rights offering in June 2025. This was a direct appeal to shareholders, including a $21.0 million backstop from the Jonas family, which is a strong signal of insider confidence, but also a clear indication that equity is the preferred source of capital. You can read more about this in our full post: Breaking Down Rafael Holdings, Inc. (RFL) Financial Health: Key Insights for Investors.

The table below shows how their minimal debt is structured, though the total amount is functionally negligible for a company of this size and focus:

Your next step is to monitor their cash burn rate against this equity base. The low debt means minimal insolvency risk, but the clock is ticking on their cash runway as R&D costs rise.

Liquidity and Solvency

You're looking for a clear picture of Rafael Holdings, Inc. (RFL)'s ability to meet its near-term obligations, and the data from the fiscal year 2025 (FY2025) is defintely encouraging on the surface. The short answer is that the company's liquidity position is strong, primarily due to a significant capital raise, but you must watch its cash burn closely.

As of the end of the fiscal year on July 31, 2025, Rafael Holdings, Inc. had a very healthy current ratio of 4.89 and a quick ratio of 4.86. These ratios show the company has almost five times the current assets needed to cover its current liabilities. For a clinical-stage pharmaceutical and real estate holding company, this is a sign of excellent short-term financial health. The quick ratio, which strips out inventory, is practically identical, confirming that the company's current assets are highly liquid-mostly cash.

Working Capital and Cash Flow Trends

The trend in working capital is a story of strategic financing overcoming operational cash usage. Rafael Holdings, Inc. significantly bolstered its current assets in the fourth quarter of FY2025 with the closing of a $25 million rights offering, which yielded net proceeds of $24.9 million in June 2025. This capital injection directly increased the working capital (current assets minus current liabilities), giving the company a strong balance sheet cushion.

Here's the quick math on the cash position:

• Cash and cash equivalents stood at $52.8 million as of July 31, 2025.
• This is a substantial increase from the prior period, a direct result of the financing activities.

Looking at the cash flow statement, the operating cash flow is where the real story lies. Like most clinical-stage biotechs, Rafael Holdings, Inc. is cash-flow negative from operations. The full fiscal year 2025 saw a net loss of $30.5 million. This loss reflects the increased research and development (R&D) expenses, which rose to $12.8 million for the full year, driven by the consolidation of Cyclo Therapeutics following the March 2025 merger. This high R&D spend is the engine of the business, but it's also the source of the cash burn. For example, the Free Cash Flow (FCF) for Q4 2025 was negative $10.38 million.

The cash flow breakdown looks like this:

Liquidity Strengths and Concerns

The immediate strength is undeniable: the company has a strong cash runway. The $52.8 million in cash and the high liquidity ratios mean Rafael Holdings, Inc. is not at risk of defaulting on current obligations. They are well-positioned to fund the ongoing pivotal Phase 3 TransportNPC™ study for Trappsol® Cyclo™.

However, the concern is the burn rate. A net loss of $30.5 million for the year means they are using up that cash cushion. The company's ability to maintain this strong liquidity hinges on two things: the continued success of its clinical pipeline and its access to future capital. For now, the financing activities have bought them significant time to reach crucial clinical milestones. Keep track of the Breaking Down Rafael Holdings, Inc. (RFL) Financial Health: Key Insights for Investors blog post for updates.

Valuation Analysis

You're looking at Rafael Holdings, Inc. (RFL) and trying to figure out if the stock price of around $1.24 today is a bargain or a value trap. The direct takeaway is that traditional valuation metrics are largely unhelpful because the company is in a pre-profit, clinical-stage phase, but the Price-to-Book ratio suggests a potential deep-value play in its assets.

As a seasoned analyst, I focus on what the numbers actually tell us, and for Rafael Holdings, Inc., the story is complex. The company operates in two segments, Healthcare and Real Estate, but its financial profile is dominated by its investment in the development of therapies like Trappsol Cyclo for rare diseases.

Is Rafael Holdings, Inc. Overvalued or Undervalued?

When a company is losing money, which Rafael Holdings, Inc. is, standard valuation tools like the Price-to-Earnings (P/E) ratio and Enterprise Value-to-EBITDA (EV/EBITDA) break down. Here's the quick math on why you can't use them for the 2025 fiscal year:

• Price-to-Earnings (P/E) Ratio: This ratio is not meaningful (NM) because the company's TTM (trailing twelve months) Earnings Per Share (EPS) is negative, at approximately -$1.04. You can't compare a negative P/E to the market.
• EV/EBITDA Ratio: Similarly, the TTM Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) is negative, coming in at about -$24.82 million. A negative EBITDA makes the EV/EBITDA ratio unusable for comparative valuation.

The company's revenue for the 2025 fiscal year was just $917,000, while the net loss was -$30.52 million. These figures confirm the company is in a heavy investment phase, not a cash-generating one. This is a bet on the pipeline, not the current income statement.

The Price-to-Book Value Signal

The one metric that does offer a clear signal is the Price-to-Book (P/B) ratio. This ratio compares the stock price to the company's book value per share (assets minus liabilities). Rafael Holdings, Inc.'s P/B ratio is approximately 0.64. A P/B ratio below 1.0 suggests the stock is trading for less than the liquidation value of its net assets. Honestly, that's a strong indicator of being undervalued, but what this estimate hides is the true value of the intangible assets (like the drug pipeline) and the quality of the tangible assets (like the real estate). Still, you are paying about 64 cents for every dollar of net assets on the books. That's defintely worth a closer look.

For a deeper dive into the company's strategic direction, I recommend reviewing the Mission Statement, Vision, & Core Values of Rafael Holdings, Inc. (RFL).

Stock Trend and Analyst Sentiment

The market has not been kind to Rafael Holdings, Inc. over the past year. The stock has been on a downward trend, falling by about -35.42% over the last 12 months. The 52-week price range tells the story of volatility and decline, with a high of $3.19 and a recent low of $1.19. This is a high-risk, low-momentum stock right now.

You also need to know that the stock does not pay a dividend, so you won't be compensated for the risk with income. Plus, Wall Street analysts are not optimistic; the consensus rating is a straightforward 'Sell,' based on the single analyst who has issued a rating in the last year. They see a significant downside risk. My action for you is clear: if you are considering an investment, you must treat this as a highly speculative venture based on the potential success of its clinical-stage assets, not on current financial performance.

Next Step: Finance: Model a scenario analysis of RFL's cash runway against the projected timeline for its Phase 3 clinical trial results to quantify the near-term risk. You need to know how long the cash lasts.

Risk Factors

You're looking at Rafael Holdings, Inc. (RFL) because you know the life sciences sector offers high reward, but honestly, you have to face the high-stakes risks head-on. The company's financial health in fiscal year 2025, which ended July 31, 2025, clearly maps to the core biotech risk: a substantial cash burn tied to a single, pivotal clinical program. That's the main takeaway here.

The biggest near-term risk is the binary outcome of the lead drug candidate, Trappsol® Cyclo™, which is in a pivotal Phase 3 clinical trial for Niemann-Pick Disease Type C1 (NPC1). In the biotech world, a Phase 3 trial is a do-or-die moment. The Data Monitoring Committee (DMC) did recommend continuing the TransportNPC™ study after their 48-week review, which is a positive signal, but still, regulatory approval is never guaranteed. If the trial fails to meet its endpoints, the stock price will defintely reflect that immediately.

Operational and Financial Risks from FY 2025 Filings

The company's shift from a real estate holding company to a pure-play biotech, largely through the March 2025 merger with Cyclo Therapeutics, brought new financial dynamics. Here's the quick math on the cash burn from the fiscal year 2025 results:

• Net Loss: Rafael Holdings, Inc. reported a full fiscal year 2025 net loss of approximately $30.5 million.
• R&D Expenses: Research and development expenses soared to $12.8 million for the year, up significantly from the prior year, due to the consolidation of Cyclo Therapeutics' clinical programs.
• G&A Expenses: General and administrative costs also rose to $13.8 million, driven by the integration of Cyclo and other entities like Cornerstone and Day Three.

This high burn rate creates a financial risk, specifically the need for future capital. While the company had cash and cash equivalents of $52.8 million as of July 31, 2025, and successfully closed a $25 million rights offering in June, that capital runway is finite given the $30.5 million annual net loss. You need to watch for future shareholder dilution (a new major risk noted in May 2025) as a primary financing mechanism.

External Competition and Mitigation Strategy

The external risk is competition in the rare disease space, though Trappsol® Cyclo™ is advanced for NPC1. The regulatory environment for orphan drugs (drugs for rare diseases) can be complex, too, even with Fast Track or Orphan Drug designations. The mitigation strategy for Rafael Holdings, Inc. (RFL) is clear: they are focusing all resources on their most advanced, high-potential asset.

They've curtailed early-stage development efforts to reduce spending and are now focused on clinical-stage assets, which is a smart move to conserve capital and accelerate a potential return. This focus is explicitly funded by the $25 million rights offering, with a significant $21.0 million backstop from the Jonas family, showing strong insider commitment. Still, the entire thesis rests on that one Phase 3 trial.

To understand the full context of this strategy, you should read more about the institutional interest in the company: Exploring Rafael Holdings, Inc. (RFL) Investor Profile: Who's Buying and Why?

Growth Opportunities

You're looking at Rafael Holdings, Inc. (RFL) and trying to map out a clear path to value, which is smart because this is a clinical-stage biotech that just completed a major strategic pivot. The direct takeaway is this: RFL's future hinges almost entirely on the success of its lead asset, Trappsol® Cyclo™, for Niemann-Pick Disease Type C1 (NPC), a rare genetic disorder. The company has shifted its focus from early-stage research to acquiring and advancing clinical-stage programs, a move that concentrates risk but accelerates the timeline to potential commercial revenue.

The core growth driver is product innovation via acquisition. The March 2025 merger with Cyclo Therapeutics brought in Trappsol® Cyclo™ and the pivotal Phase 3 TransportNPC™ clinical trial. This single asset is now the engine. To fund this, RFL successfully completed a $25 million rights offering in June 2025, which included a $21.0 million backstop commitment from the Jonas family, strengthening the balance sheet with $52.8 million in cash and equivalents as of July 31, 2025. That's a necessary war chest for a late-stage trial.

Near-Term Revenue and Earnings Estimates

Honestly, for a company like Rafael Holdings, traditional revenue projections are misleading right now. The 2025 fiscal year revenue was only $917.00K, though that did represent a 43.96% growth from the prior year, but it's not a commercial figure. The real number to watch is the burn rate, not the top line. The full fiscal year 2025 net loss was $30.6 million, an improvement from the prior year's loss, but R&D expenses soared to $12.8 million as they integrated the Cyclo Therapeutics trial.

Here's the quick math: The company is investing heavily in its future. The full fiscal year 2025 loss per share was $1.04. What this estimate hides is the potential for a massive, non-linear revenue jump if Trappsol® Cyclo™ is approved. Until then, you are an investor in a clinical milestone, not a sales trajectory.

• Full FY2025 Revenue: $917.00K.
• Full FY2025 Net Loss: $30.6 million.
• Full FY2025 R&D Spend: $12.8 million.
• FY2025 EPS Loss: $1.04 per share.

Strategic Focus and Competitive Edge

The strategic initiative is crystal clear: acquire and develop treatments for diseases with high unmet medical needs (orphan diseases). The merger is the clearest example of this strategy in action. The company is now focused on the TransportNPC™ trial, which had preliminary data presented in September 2025, keeping the drug on track.

The competitive advantage lies in the nature of the drug itself and its market position. Niemann-Pick Disease Type C1 is a rare and fatal genetic disease, and while there have been recent FDA approvals for other treatments, management believes Trappsol® Cyclo™ has the potential to be a market leader. This is a high-stakes, winner-take-most market. The company's competitive position is built on:

• Lead Asset Focus: Trappsol® Cyclo™ is the sole focus, simplifying the R&D pipeline.
• Orphan Drug Status: Targeting a rare disease provides market exclusivity and regulatory incentives.
• Clinical Stage: Being in a pivotal Phase 3 trial is a significant de-risking step compared to a pre-clinical asset.

If you want to dig deeper into who is buying in on this rare disease bet, you should be Exploring Rafael Holdings, Inc. (RFL) Investor Profile: Who's Buying and Why?. The next concrete step for you is to monitor the news for the final topline data release from the Phase 3 TransportNPC™ trial; that will defintely be the next major catalyst.