ADMA Biologics, Inc. (ADMA): A Bull Case Theory

We came across a bullish thesis on ADMA Biologics, Inc. on Archive Invest’s Substack by Felix. In this article, we will summarize the bulls’ thesis on ADMA. ADMA Biologics, Inc.’s share was trading at $17.80 as of August 22nd. ADMA’s trailing and forward P/E were 20.94 and 28.99 respectively according to Yahoo Finance.

Adma Biologics (ADMA) has delivered a remarkable financial turnaround, with 2024 standing out as a pivotal year. Gross profit has compounded at an impressive 34% CAGR from 2020 to 2024, reflecting strong topline expansion. Net income has moved from a loss of $75.5 million in 2020 to profitability of $197.7 million in 2024, marking a significant inflection point. Operating income turned positive in 2023 and has accelerated since, while free cash flow now stands around $110 million, cementing the company’s move into consistent profitability.

These gains are further supported by robust margins, both at the gross and net income levels, underscoring operational discipline. Return on invested capital has surged to an extraordinary 78%, indicating highly effective capital allocation, while goodwill remains negligible, highlighting that growth is being achieved organically rather than through acquisitions. Capex requirements have also declined, further enhancing free cash generation.

While insider ownership sits around 2%, below the 10% benchmark often favored by investors, founders remain active in the business, signaling alignment with shareholder interests. Stock-based compensation, though impacting free cash flow accounting, is small relative to overall FCF and does not materially alter the investment case. ADMA has also initiated buybacks, including a $5 million program in 2024, reflecting confidence in future performance, though some investors may prefer reinvestment over repurchases.

Valuation metrics strengthen the appeal, with forward P/E and P/FCF both trading below historical medians, suggesting meaningful undervaluation. With accelerating profitability, strong capital efficiency, and expanding margins, ADMA presents a compelling investment case with significant upside potential.

Previously we covered a bullish thesis on Bio-Techne Corporation (TECH) by scuttleblurb in May 2025, which highlighted its diversified model across proteins, diagnostics, and CGT while noting cyclical risks. The company’s stock price has depreciated approximately by 19.11% since our coverage. This is because growth expectations were reset after COVID tailwinds faded. The thesis still stands as organic growth rebounds. Felix shares a similar bullish stance on ADMA Biologics, but emphasizes profitability inflection and undervaluation.

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Disclosure: None.