Forensic Analysis · Healthcare / Pharmaceuticals / Biotech · as of Jun 27, 2026
RHYTHM PHARMACEUTICALS, INC. (RYTM)
A forensic read on RHYTHM PHARMACEUTICALS, INC. built from its complete SEC filings — financial-health screens, earnings quality, red flags and a price-aware rating. Reproducible math, not opinion.
D · Weak — demands caution
Forensic grade
Distress
Financial health
-6.2
Altman Z-score
Clean
Earnings quality
4
Forensic signals
-86.5%
ROE
$7.5B
Market cap
RHYTHM PHARMACEUTICALS, INC. earns a D (Weak — demands caution) forensic quality grade, and its Altman Z-score is -6.2, placing it in the Distress zone. 4 forensic signals were flagged in its latest SEC filings, led by accruals ratio.
What the filings flag
+54.5%Accruals ratio.Net operating assets grew +54.5% relative to their average in FY2025 — the accrual component of earnings. Accruals are building sharply — a large slice of profit sits in operating assets, not cash; Richardson/Sloan link high accruals to weaker future returns as they reverse. The cash-flow cross-check agrees: reported earnings ran behind operating cash by -32% of net operating assets.
-46%Return on invested capital.Return on invested capital is -46% and rising from -66% — well below its ~10% cost of capital, so reinvested dollars may be destroying value, not building it.
+8.2%/yrShare-count dilution.Diluted share count changed +25% over the last 3 years to FY2025 (+8.2%/yr). The count is GROWING — existing holders are being diluted. That's ~8.2% shaved off per-share growth every year — total profit has to grow that much just to keep earnings-per-share flat, and a stake held since FY2022 has been diluted ~25%.
35% of revStock-based comp load.Stock-based compensation ran 35% of revenue in FY2025 — about $1.03 per diluted share. Meaningful — reported free cash flow flatters the economics, since SBC is a real cost paid in shares.
Key fundamentals
Net Margin-103.6%
Debt / Equity0.78x
Free Cash Flow$-116.6M
Latest Revenue$189.8M
Return on Equity-141.3%
Revenue Growth YoY+45.8%
Go deeper — free with an account
The forensic grade and screens above are free — no account needed. An account adds the full interactive deep-dive on RHYTHM PHARMACEUTICALS, INC.:
🔒The written investment read — what the numbers mean, in plain English
🔒Ask anything about RYTM's filings — AI Q&A across the 10-K, 10-Qs & 8-Ks
🔒Interactive valuation — reverse-DCF sliders, Monte Carlo & scenario stress
🔒Calibrated 12-month price forecast, with the math shown