Is CATALYST PHARMACEUTICALS INC (NASDAQ:CPRX) on the Verge of a Major Breakout as a Strong Growth Stock?

For growth-minded investors, high revenue and EPS growth are key criteria. Today, we'll examine whether CATALYST PHARMACEUTICALS INC (NASDAQ:CPRX) fits the bill for growth investing, particularly as it forms a base and hints at a potential breakout. Remember, due diligence is essential, but CATALYST PHARMACEUTICALS INC has caught our attention on our screen for growth with base formation. It may warrant additional investigation.

Understanding CPRX's Growth Score

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. CPRX has earned a 9 for growth:

• CPRX shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 61.73%, which is quite impressive.
• Measured over the past years, CPRX shows a very strong growth in Earnings Per Share. The EPS has been growing by 34.29% on average per year.
• CPRX shows a strong growth in Revenue. In the last year, the Revenue has grown by 23.47%.
• CPRX shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 36.89% yearly.
• The Earnings Per Share is expected to grow by 29.57% on average over the next years. This is a very strong growth
• Based on estimates for the next years, CPRX will show a quite strong growth in Revenue. The Revenue will grow by 11.94% on average per year.

Evaluating Health: CPRX

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. CPRX has received a 8 out of 10:

• CPRX has an Altman-Z score of 16.22. This indicates that CPRX is financially healthy and has little risk of bankruptcy at the moment.
• CPRX has a better Altman-Z score (16.22) than 93.13% 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.
• A Current Ratio of 5.17 indicates that CPRX has no problem at all paying its short term obligations.
• A Quick Ratio of 5.01 indicates that CPRX has no problem at all paying its short term obligations.

Profitability Insights: 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 CPRX, the assigned 9 is a significant indicator of profitability:

• With an excellent Return On Assets value of 19.25%, CPRX belongs to the best of the industry, outperforming 98.24% of the companies in the same industry.
• CPRX's Return On Equity of 22.52% is amongst the best of the industry. CPRX outperforms 97.36% of its industry peers.
• With an excellent Return On Invested Capital value of 20.21%, CPRX belongs to the best of the industry, outperforming 98.06% of the companies in the same industry.
• Measured over the past 3 years, the Average Return On Invested Capital for CPRX is significantly above the industry average of 14.25%.
• The Profit Margin of CPRX (33.33%) is better than 98.24% of its industry peers.
• CPRX's Operating Margin of 39.68% is amongst the best of the industry. CPRX outperforms 99.30% of its industry peers.
• CPRX's Operating Margin has improved in the last couple of years.
• CPRX has a better Gross Margin (86.00%) than 88.03% of its industry peers.

How do we evaluate the setup for CPRX?

ChartMill also assign a Setup Rating to every stock. With this score it is determined to what extend the stock has been trading in a range in the recent days and weeks. This score also ranges from 0 to 10 and is updated daily. The setup score evaluates various short term technical indicators. CPRX scores a 7 out of 10:

CPRX has an excellent technical rating and also presents a decent setup pattern. Prices have been consolidating lately and the volatility has been reduced. There is very little resistance above the current price. There is a support zone below the current price at 22.95, 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.

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

For an up to date full technical analysis you can check the technical 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.