NASDAQ:ALKS is an undervalued gem with solid fundamentals.

Last update: Oct 28, 2024

ALKERMES PLC (NASDAQ:ALKS) has caught the attention of our stock screener as a great value stock. NASDAQ:ALKS excels in profitability, solvency, and liquidity, all while being very reasonably priced. Let's delve into the details.

Understanding NASDAQ:ALKS's Valuation

ChartMill assigns a proprietary Valuation Rating to each stock. The score is computed by evaluating various valuation aspects, like price to earnings and free cash flow, both absolutely as relative to the market and industry. NASDAQ:ALKS was assigned a score of 9 for valuation:

ALKS's Price/Earnings ratio is rather cheap when compared to the industry. ALKS is cheaper than 97.86% of the companies in the same industry.
ALKS's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 30.92.
The Price/Forward Earnings ratio is 9.77, which indicates a very decent valuation of ALKS.
Based on the Price/Forward Earnings ratio, ALKS is valued cheaply inside the industry as 98.57% of the companies are valued more expensively.
When comparing the Price/Forward Earnings ratio of ALKS to the average of the S&P500 Index (22.41), we can say ALKS is valued rather cheaply.
Based on the Enterprise Value to EBITDA ratio, ALKS is valued cheaply inside the industry as 98.75% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, ALKS is valued cheaply inside the industry as 98.22% of the companies are valued more expensively.
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.
ALKS's earnings are expected to grow with 25.62% in the coming years. This may justify a more expensive valuation.

Understanding NASDAQ:ALKS's Profitability

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NASDAQ:ALKS was assigned a score of 6 for profitability:

The Return On Assets of ALKS (15.47%) is better than 98.04% of its industry peers.
Looking at the Return On Equity, with a value of 25.80%, ALKS belongs to the top of the industry, outperforming 98.22% of the companies in the same industry.
ALKS has a Return On Invested Capital of 20.27%. This is amongst the best in the industry. ALKS outperforms 98.57% of its industry peers.
ALKS has a better Profit Margin (22.15%) than 97.15% of its industry peers.
Looking at the Operating Margin, with a value of 29.00%, ALKS belongs to the top of the industry, outperforming 97.86% of the companies in the same industry.
Looking at the Gross Margin, with a value of 83.17%, ALKS belongs to the top of the industry, outperforming 88.41% of the companies in the same industry.

Health Insights: NASDAQ:ALKS

ChartMill assigns a Health Rating to every stock. This score ranges from 0 to 10 and evaluates the different health aspects like liquidity and solvency, both absolutely, but also relative to the industry peers. NASDAQ:ALKS scores a 7 out of 10:

ALKS has an Altman-Z score of 4.24. This indicates that ALKS is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 4.24, ALKS is doing good in the industry, outperforming 77.18% of the companies in the same industry.
ALKS has a debt to FCF ratio of 0.92. This is a very positive value and a sign of high solvency as it would only need 0.92 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 0.92, ALKS belongs to the best of the industry, outperforming 96.61% of the companies in the same industry.
A Debt/Equity ratio of 0.22 indicates that ALKS is not too dependend on debt financing.
Even though the debt/equity ratio score it not favorable for ALKS, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
A Current Ratio of 3.45 indicates that ALKS has no problem at all paying its short term obligations.
A Quick Ratio of 3.03 indicates that ALKS has no problem at all paying its short term obligations.

Assessing Growth for NASDAQ:ALKS

Every stock receives a Growth Rating from ChartMill, ranging from 0 to 10. This rating assesses various growth aspects, including historical and projected EPS and revenue growth. NASDAQ:ALKS boasts a 4 out of 10:

ALKS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 54.48%, which is quite impressive.
Measured over the past years, ALKS shows a quite strong growth in Earnings Per Share. The EPS has been growing by 18.41% on average per year.
ALKS shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 8.74% yearly.
ALKS is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 10.51% yearly.

Every day, new Decent Value stocks can be found on ChartMill in our Decent Value screener.

Our latest full fundamental report of ALKS contains the most current fundamental analsysis.

Keep in mind

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.