Akebia Therapeutics just took a 26% hit, with the stock sliding to about US$0.95, as investors reacted to a quarter that put its valuation strain back in the spotlight. The immediate trigger was Q2 revenue of US$49.1 million and another quarterly net loss. The key issue is what that means for a stock that trades on a very low price to sales ratio and a large gap to modelled future cash flow value.

The short term looks painful on the screen. The bigger question is how long Akebia can run its loss making kidney portfolio before the balance between cash, debt and future value starts to really matter.

Is Akebia Therapeutics a deep value setup at a US$0.95 share price, or is the low price to sales ratio simply mirroring its ongoing losses…