Investors should take notice of NASDAQ:CPRX—it offers a great deal for the fundamentals it presents.

Our stock screener has spotted CATALYST PHARMACEUTICALS INC (NASDAQ:CPRX) as an undervalued stock with solid fundamentals. NASDAQ:CPRX shows decent health and profitability. At the same time it remains remains attractively priced. We'll dive into each aspect below.

Analyzing Valuation Metrics

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:CPRX has earned a 8 for valuation:

• Based on the Price/Earnings ratio, CPRX is valued cheaply inside the industry as 96.31% of the companies are valued more expensively.
• 95.96% of the companies in the same industry are more expensive than CPRX, based on the Price/Forward Earnings ratio.
• Compared to an average S&P500 Price/Forward Earnings ratio of 20.91, CPRX is valued a bit cheaper.
• Based on the Enterprise Value to EBITDA ratio, CPRX is valued cheaply inside the industry as 95.96% of the companies are valued more expensively.
• Based on the Price/Free Cash Flow ratio, CPRX is valued cheaper than 98.95% of the companies in the same industry.
• CPRX's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• CPRX has an outstanding profitability rating, which may justify a higher PE ratio.
• CPRX's earnings are expected to grow with 26.83% in the coming years. This may justify a more expensive valuation.

Understanding NASDAQ:CPRX's Profitability

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. NASDAQ:CPRX has earned a 8 out of 10:

• Looking at the Return On Assets, with a value of 9.64%, CPRX belongs to the top of the industry, outperforming 97.19% of the companies in the same industry.
• CPRX has a Return On Equity of 11.19%. This is amongst the best in the industry. CPRX outperforms 96.31% of its industry peers.
• CPRX has a better Return On Invested Capital (10.83%) than 96.31% of its industry peers.
• CPRX had an Average Return On Invested Capital over the past 3 years of 20.38%. This is significantly above the industry average of 12.61%.
• The last Return On Invested Capital (10.83%) for CPRX is well below the 3 year average (20.38%), which needs to be investigated, but indicates that CPRX had better years and this may not be a problem.
• CPRX has a Profit Margin of 15.68%. This is amongst the best in the industry. CPRX outperforms 97.36% of its industry peers.
• The Operating Margin of CPRX (19.76%) is better than 97.01% of its industry peers.
• CPRX has a Gross Margin of 86.67%. This is amongst the best in the industry. CPRX outperforms 89.98% of its industry peers.

Assessing Health for NASDAQ:CPRX

Every stock is evaluated by ChartMill, receiving a Health Rating on a scale of 0 to 10. This assessment considers different health aspects, including liquidity and solvency, both in absolute terms and relative to industry peers. NASDAQ:CPRX has achieved a 8 out of 10:

• An Altman-Z score of 17.04 indicates that CPRX is not in any danger for bankruptcy at the moment.
• CPRX has a Altman-Z score of 17.04. This is amongst the best in the industry. CPRX outperforms 91.21% of its industry peers.
• There is no outstanding debt for CPRX. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
• CPRX has a Current Ratio of 5.14. This indicates that CPRX is financially healthy and has no problem in meeting its short term obligations.
• A Quick Ratio of 4.94 indicates that CPRX has no problem at all paying its short term obligations.

ChartMill's Evaluation of Growth

A key component of ChartMill's stock assessment is the Growth Rating, which spans from 0 to 10. This rating evaluates diverse growth factors, such as EPS and revenue growth, considering both past performance and future projections. NASDAQ:CPRX has received a 8 out of 10:

• CPRX shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 25.48% yearly.
• Looking at the last year, CPRX shows a very strong growth in Revenue. The Revenue has grown by 43.40%.
• CPRX shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 280.39% yearly.
• Based on estimates for the next years, CPRX will show a very strong growth in Earnings Per Share. The EPS will grow by 27.45% on average per year.
• The Revenue is expected to grow by 11.42% on average over the next years. This is quite good.

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

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

Disclaimer

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.