NASDAQ:ALKS, a growth stock which is not overvalued.

Uncover the potential of ALKERMES PLC (NASDAQ:ALKS), a growth stock that our stock screener found to be reasonably priced. NASDAQ:ALKS is excelling in growth aspects, maintaining a healthy financial position, and still offers an attractive valuation. We'll examine each aspect in detail.

Growth Assessment of NASDAQ:ALKS

ChartMill assigns a Growth Rating to every stock. This score ranges from 0 to 10 and evaluates the different growth aspects like EPS and Revenue, both in the past as in the future. NASDAQ:ALKS scores a 7 out of 10:

• The Earnings Per Share has grown by an impressive 211.63% over the past year.
• The Earnings Per Share has been growing by 14.87% on average over the past years. This is quite good.
• Looking at the last year, ALKS shows a very strong growth in Revenue. The Revenue has grown by 40.56%.
• ALKS is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 52.71% yearly.
• When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
• The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.

ChartMill's Evaluation of Valuation

ChartMill employs its own Valuation Rating system for all stocks. This score, ranging from 0 to 10, is determined by evaluating different valuation factors, including price to earnings and free cash flow, both in absolute terms and relative to the market and industry. NASDAQ:ALKS has earned a 8 for valuation:

• Based on the Price/Earnings ratio, ALKS is valued cheaply inside the industry as 96.45% of the companies are valued more expensively.
• The Price/Forward Earnings ratio is 11.98, which indicates a very decent valuation of ALKS.
• Compared to the rest of the industry, the Price/Forward Earnings ratio of ALKS indicates a rather cheap valuation: ALKS is cheaper than 98.31% of the companies listed in the same industry.
• The average S&P500 Price/Forward Earnings ratio is at 20.76. ALKS is valued slightly cheaper when compared to this.
• Based on the Enterprise Value to EBITDA ratio, ALKS is valued cheaply inside the industry as 96.62% of the companies are valued more expensively.
• Based on the Price/Free Cash Flow ratio, ALKS is valued cheaper than 97.12% of the companies in the same industry.
• The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• ALKS has a very decent profitability rating, which may justify a higher PE ratio.
• A more expensive valuation may be justified as ALKS's earnings are expected to grow with 102.31% in the coming years.

Evaluating Health: NASDAQ:ALKS

ChartMill employs its own Health Rating for stock assessment. This rating, ranging from 0 to 10, is calculated by examining various liquidity and solvency ratios. In the case of NASDAQ:ALKS, the assigned 6 reflects its health status:

• An Altman-Z score of 3.77 indicates that ALKS is not in any danger for bankruptcy at the moment.
• The Altman-Z score of ALKS (3.77) is better than 72.93% of its industry peers.
• ALKS has a debt to FCF ratio of 1.15. This is a very positive value and a sign of high solvency as it would only need 1.15 years to pay back of all of its debts.
• ALKS has a better Debt to FCF ratio (1.15) than 95.94% of its industry peers.
• A Debt/Equity ratio of 0.21 indicates that ALKS is not too dependend on debt financing.
• Although ALKS does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
• A Current Ratio of 2.91 indicates that ALKS has no problem at all paying its short term obligations.
• A Quick Ratio of 2.53 indicates that ALKS has no problem at all paying its short term obligations.

What does the Profitability looks like for NASDAQ:ALKS

ChartMill's Profitability Rating offers a unique perspective on stock analysis, providing scores from 0 to 10. These ratings consider a wide range of profitability metrics and margins, both in comparison to industry peers and on their own merits. For NASDAQ:ALKS, the assigned 6 is a significant indicator of profitability:

• With an excellent Return On Assets value of 9.42%, ALKS belongs to the best of the industry, outperforming 97.46% of the companies in the same industry.
• ALKS has a better Return On Equity (15.85%) than 97.29% of its industry peers.
• ALKS has a Return On Invested Capital of 9.83%. This is amongst the best in the industry. ALKS outperforms 96.28% of its industry peers.
• Looking at the Profit Margin, with a value of 13.50%, ALKS belongs to the top of the industry, outperforming 96.95% of the companies in the same industry.
• The Operating Margin of ALKS (13.89%) is better than 96.28% of its industry peers.
• ALKS's Gross Margin of 85.10% is amongst the best of the industry. ALKS outperforms 87.82% of its industry peers.

Our Affordable Growth screener lists more Affordable Growth stocks and is updated daily.

Check the latest full fundamental report of ALKS for a complete fundamental analysis.

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.