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

Last update: Oct 30, 2024

CATALYST PHARMACEUTICALS INC (NASDAQ:CPRX) was identified as an affordable growth stock by our stock screener. NASDAQ:CPRX is showing great growth, but also scores well on profitability, solvency and liquidity. At the same time it seems to be priced reasonably. We'll explore this a bit deeper below.

Analyzing Growth Metrics

ChartMill employs its own Growth Rating system for all stocks. This score, ranging from 0 to 10, is derived by evaluating different growth factors, such as EPS and revenue growth, taking into account both past performance and future projections. NASDAQ:CPRX has earned a 8 for growth:

The Earnings Per Share has been growing by 25.48% on average over the past years. This is a very strong growth
CPRX shows a strong growth in Revenue. In the last year, the Revenue has grown by 43.40%.
The Revenue has been growing by 280.39% on average over the past years. This is a very strong growth!
The Earnings Per Share is expected to grow by 27.45% on average over the next years. This is a very strong growth
The Revenue is expected to grow by 11.42% on average over the next years. This is quite good.

Understanding NASDAQ:CPRX's Valuation

An integral part of ChartMill's stock analysis is the Valuation Rating, which spans from 0 to 10. This rating evaluates diverse valuation factors, including price to earnings and cash flows, while considering the stock's profitability and growth. NASDAQ:CPRX has received a 7 out of 10:

Based on the Price/Earnings ratio, CPRX is valued cheaply inside the industry as 95.19% of the companies are valued more expensively.
96.79% of the companies in the same industry are more expensive than CPRX, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 22.57. CPRX is valued slightly cheaper when compared to this.
Based on the Enterprise Value to EBITDA ratio, CPRX is valued cheaply inside the industry as 95.72% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, CPRX is valued cheaper than 98.40% of the companies in the same industry.
The excellent profitability rating of CPRX may justify a higher PE ratio.
A more expensive valuation may be justified as CPRX's earnings are expected to grow with 30.79% in the coming years.

Health Insights: NASDAQ:CPRX

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NASDAQ:CPRX, the assigned 8 for health provides valuable insights:

CPRX has an Altman-Z score of 17.90. This indicates that CPRX is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 17.90, CPRX belongs to the top of the industry, outperforming 91.62% of the companies in the same industry.
CPRX has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the 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.

Understanding NASDAQ:CPRX's Profitability

Discover ChartMill's exclusive Profitability Rating, a proprietary metric that assesses stocks on a scale of 0 to 10. It takes into consideration various profitability ratios and margins, both in absolute terms and relative to industry peers. Notably, NASDAQ:CPRX has achieved a 8:

With an excellent Return On Assets value of 9.64%, CPRX belongs to the best of the industry, outperforming 96.26% of the companies in the same industry.
CPRX's Return On Equity of 11.19% is amongst the best of the industry. CPRX outperforms 95.54% of its industry peers.
The Return On Invested Capital of CPRX (10.83%) is better than 95.90% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for CPRX is significantly above the industry average of 13.89%.
The 3 year average ROIC (20.38%) for CPRX is well above the current ROIC(10.83%). The reason for the recent decline needs to be investigated.
With an excellent Profit Margin value of 15.68%, CPRX belongs to the best of the industry, outperforming 96.43% of the companies in the same industry.
CPRX has a Operating Margin of 19.76%. This is amongst the best in the industry. CPRX outperforms 96.43% of its industry peers.
CPRX has a Gross Margin of 86.67%. This is amongst the best in the industry. CPRX outperforms 89.84% of its industry peers.

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

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

Keep in mind

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.