While growth is established for NASDAQ:CPRX, the stock's valuation remains reasonable.

Last update: Jan 22, 2025

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.

Growth Assessment of NASDAQ:CPRX

ChartMill assigns a proprietary Growth Rating to each stock. The score is computed by evaluating various growth aspects, like EPS and revenue growth. We take into account the history as well as the estimated future numbers. NASDAQ:CPRX was assigned a score of 9 for growth:

The Earnings Per Share has grown by an impressive 63.89% over the past year.
Measured over the past years, CPRX shows a very strong growth in Earnings Per Share. The EPS has been growing by 25.48% on average per year.
The Revenue has grown by 32.13% in the past year. This is a very strong growth!
CPRX shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 280.39% yearly.
CPRX is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 32.43% yearly.
CPRX is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 14.81% yearly.
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.

Valuation Analysis for NASDAQ:CPRX

ChartMill provides a Valuation Rating to every stock, ranging from 0 to 10. This rating assesses various valuation aspects, comparing price to earnings and cash flows, while considering factors like profitability and growth. NASDAQ:CPRX boasts a 8 out of 10:

Based on the Price/Earnings ratio, CPRX is valued cheaper than 95.93% of the companies in the same industry.
When comparing the Price/Earnings ratio of CPRX to the average of the S&P500 Index (28.29), we can say CPRX is valued slightly cheaper.
Based on the Price/Forward Earnings ratio, CPRX is valued cheaper than 96.28% of the companies in the same industry.
CPRX's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 24.44.
Based on the Enterprise Value to EBITDA ratio, CPRX is valued cheaply inside the industry as 97.52% of the companies are valued more expensively.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of CPRX indicates a rather cheap valuation: CPRX is cheaper than 97.88% of the companies listed 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.
The excellent profitability rating of CPRX may justify a higher PE ratio.
CPRX's earnings are expected to grow with 34.80% in the coming years. This may justify a more expensive valuation.

A Closer Look at Health for 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:

An Altman-Z score of 17.20 indicates that CPRX is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 17.20, CPRX belongs to the top of the industry, outperforming 91.15% 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 5.11. This indicates that CPRX is financially healthy and has no problem in meeting its short term obligations.
CPRX has a Quick Ratio of 4.92. This indicates that CPRX is financially healthy and has no problem in meeting its short term obligations.

Evaluating Profitability: NASDAQ:CPRX

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:CPRX, the assigned 8 is a significant indicator of profitability:

CPRX has a Return On Assets of 18.50%. This is amongst the best in the industry. CPRX outperforms 98.41% of its industry peers.
With an excellent Return On Equity value of 21.61%, CPRX belongs to the best of the industry, outperforming 97.35% of the companies in the same industry.
CPRX has a better Return On Invested Capital (20.22%) than 98.23% 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 13.83%.
CPRX has a better Profit Margin (31.01%) than 98.23% of its industry peers.
With an excellent Operating Margin value of 37.78%, CPRX belongs to the best of the industry, outperforming 99.11% of the companies in the same industry.
With an excellent Gross Margin value of 86.32%, CPRX belongs to the best of the industry, outperforming 89.73% of the companies in the same industry.

More Affordable Growth stocks can be found in our Affordable Growth screener.

For an up to date full fundamental analysis you can check the fundamental report of CPRX

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.