Don't overlook NASDAQ:HALO—a stock with solid growth prospects and a reasonable valuation.

Last update: Jun 26, 2024

HALOZYME THERAPEUTICS INC (NASDAQ:HALO) was identified as an affordable growth stock by our stock screener. NASDAQ:HALO 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.

Deciphering NASDAQ:HALO's Growth Rating

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:HALO has received a 9 out of 10:

The Earnings Per Share has grown by an impressive 39.64% over the past year.
Measured over the past years, HALO shows a very strong growth in Earnings Per Share. The EPS has been growing by 45.64% on average per year.
HALO shows a strong growth in Revenue. In the last year, the Revenue has grown by 22.40%.
HALO shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 40.42% yearly.
The Earnings Per Share is expected to grow by 25.47% on average over the next years. This is a very strong growth
Based on estimates for the next years, HALO will show a quite strong growth in Revenue. The Revenue will grow by 15.95% on average per year.

Evaluating Valuation: NASDAQ:HALO

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:HALO boasts a 8 out of 10:

97.03% of the companies in the same industry are more expensive than HALO, based on the Price/Earnings ratio.
HALO's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.60.
Based on the Price/Forward Earnings ratio of 10.41, the valuation of HALO can be described as reasonable.
97.38% of the companies in the same industry are more expensive than HALO, based on the Price/Forward Earnings ratio.
HALO is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 20.14, which is the current average of the S&P500 Index.
Based on the Enterprise Value to EBITDA ratio, HALO is valued cheaply inside the industry as 96.33% of the companies are valued more expensively.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of HALO indicates a rather cheap valuation: HALO is cheaper than 98.60% of the companies listed in the same industry.
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent profitability rating of HALO may justify a higher PE ratio.
A more expensive valuation may be justified as HALO's earnings are expected to grow with 32.63% in the coming years.

Looking at the Health

ChartMill assigns a Health Rating to every stock. This score ranges from 0 to 10 and evaluates the different health aspects like liquidity and solvency, both absolutely, but also relative to the industry peers. NASDAQ:HALO scores a 7 out of 10:

An Altman-Z score of 4.17 indicates that HALO is not in any danger for bankruptcy at the moment.
HALO has a better Altman-Z score (4.17) than 78.67% of its industry peers.
The Debt to FCF ratio of HALO is 3.54, which is a good value as it means it would take HALO, 3.54 years of fcf income to pay off all of its debts.
HALO has a Debt to FCF ratio of 3.54. This is amongst the best in the industry. HALO outperforms 95.63% of its industry peers.
HALO has a Current Ratio of 6.64. This indicates that HALO is financially healthy and has no problem in meeting its short term obligations.
HALO has a better Current ratio (6.64) than 63.46% of its industry peers.
A Quick Ratio of 5.36 indicates that HALO has no problem at all paying its short term obligations.

Analyzing Profitability Metrics

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NASDAQ:HALO was assigned a score of 7 for profitability:

HALO's Return On Assets of 17.31% is amongst the best of the industry. HALO outperforms 98.78% of its industry peers.
HALO's Return On Equity of 179.30% is amongst the best of the industry. HALO outperforms 100.00% of its industry peers.
HALO has a better Return On Invested Capital (18.09%) than 98.08% of its industry peers.
HALO had an Average Return On Invested Capital over the past 3 years of 17.78%. This is above the industry average of 14.60%.
The 3 year average ROIC (17.78%) for HALO is below the current ROIC(18.09%), indicating increased profibility in the last year.
HALO has a better Profit Margin (36.95%) than 98.95% of its industry peers.
HALO has a Operating Margin of 44.25%. This is amongst the best in the industry. HALO outperforms 99.48% of its industry peers.
HALO has a Gross Margin of 78.51%. This is amongst the best in the industry. HALO outperforms 86.89% of its industry peers.

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

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

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.