Is NASDAQ:CPRX on the Verge of a Major Breakout as a Strong Growth Stock?

Groth investors are looking for stocks showing high revenue and EPS growth. We will have a look here to see if CATALYST PHARMACEUTICALS INC (NASDAQ:CPRX) is suited for growth investing, while it is forming a base and may be ready to breakout. Investors should of course do their own research, but we spotted CATALYST PHARMACEUTICALS INC showing up in our growth with base formation screen, so it may be worth spending some more time on it.

Growth Assessment of NASDAQ:CPRX

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:CPRX scores a 9 out of 10:

• The Earnings Per Share has grown by an impressive 63.89% over the past year.
• The Earnings Per Share has been growing by 25.48% on average over the past years. This is a very strong growth
• Looking at the last year, CPRX shows a very strong growth in Revenue. The Revenue has grown by 85.90%.
• Measured over the past years, CPRX shows a very strong growth in Revenue. The Revenue has been growing by 280.39% on average per year.
• CPRX is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 27.45% yearly.
• The Revenue is expected to grow by 11.42% on average over the next years. This is quite good.

Looking at the Health

To gauge a stock's financial health, ChartMill utilizes a Health Rating on a scale of 0 to 10. This comprehensive evaluation encompasses liquidity and solvency, both in absolute terms and in comparison to industry peers. NASDAQ:CPRX has earned a 8 out of 10:

• CPRX has an Altman-Z score of 17.77. This indicates that CPRX is financially healthy and has little risk of bankruptcy at the moment.
• With an excellent Altman-Z score value of 17.77, CPRX belongs to the best of the industry, outperforming 90.83% 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.
• CPRX has a Quick Ratio of 4.94. This indicates that CPRX is financially healthy and has no problem in meeting its short term obligations.

Looking at the Profitability

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NASDAQ:CPRX scores a 8 out of 10:

• With an excellent Return On Assets value of 9.64%, CPRX belongs to the best of the industry, outperforming 96.30% 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 95.94% of its industry peers.
• CPRX has a better Return On Invested Capital (10.83%) than 95.94% of its industry peers.
• The Average Return On Invested Capital over the past 3 years for CPRX is significantly above the industry average of 13.56%.
• 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.
• Looking at the Profit Margin, with a value of 15.68%, CPRX belongs to the top of the industry, outperforming 96.30% of the companies in the same industry.
• Looking at the Operating Margin, with a value of 19.76%, CPRX belongs to the top of the industry, outperforming 96.30% of the companies in the same industry.
• Looking at the Gross Margin, with a value of 86.67%, CPRX belongs to the top of the industry, outperforming 90.30% of the companies in the same industry.

How do we evaluate the setup for NASDAQ:CPRX?

Besides the Technical Rating, ChartMill assigns a Setup Rating to every stock to determine the degree of consolidation. This rating, ranging from 0 to 10, is updated daily and evaluates various short-term technical indicators. NASDAQ:CPRX currently holds a 7 as its setup rating, suggesting a particular level of consolidation in the stock.

CPRX has an excellent technical rating and also presents a decent setup pattern. We see reduced volatility while prices have been consolidating in the most recent period. There is very little resistance above the current price. There is a support zone below the current price at 21.13, a Stop Loss order could be placed below this zone.

Every day, new Strong Growth stocks can be found on ChartMill in our Strong Growth screener.

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

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

Disclaimer

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.