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

Last update: Dec 22, 2023

Our stock screener has spotted NEUROCRINE BIOSCIENCES INC (NASDAQ:NBIX) as a growth stock which is not overvalued. NASDAQ:NBIX is scoring great on several growth aspects while it also shows decent health and profitability. At the same time it remains remains attractively priced. We'll dive into each aspect below.

Evaluating Growth: NASDAQ:NBIX

To evaluate a stock's growth potential, ChartMill utilizes a Growth Rating on a scale of 0 to 10. This comprehensive assessment considers various growth aspects, including historical and estimated EPS and revenue growth. NASDAQ:NBIX has achieved a 9 out of 10:

The Earnings Per Share has grown by an impressive 226.32% over the past year.
NBIX shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 66.75% yearly.
NBIX shows a strong growth in Revenue. In the last year, the Revenue has grown by 28.46%.
The Revenue has been growing by 55.91% on average over the past years. This is a very strong growth!
The Earnings Per Share is expected to grow by 51.63% on average over the next years. This is a very strong growth
The Revenue is expected to grow by 17.00% on average over the next years. This is quite good.

ChartMill's Evaluation of Valuation

ChartMill assigns a Valuation Rating to every stock. This score ranges from 0 to 10 and evaluates the different valuation aspects and compares the price to earnings and cash flows, while taking into account profitability and growth. NASDAQ:NBIX scores a 6 out of 10:

Compared to the rest of the industry, the Price/Earnings ratio of NBIX indicates a rather cheap valuation: NBIX is cheaper than 94.35% of the companies listed in the same industry.
Based on the Price/Forward Earnings ratio, NBIX is valued cheaper than 96.01% of the companies in the same industry.
Based on the Enterprise Value to EBITDA ratio, NBIX is valued cheaply inside the industry as 94.52% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, NBIX is valued cheaply inside the industry as 95.68% of the companies are valued more expensively.
NBIX has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as NBIX's earnings are expected to grow with 62.67% in the coming years.

Assessing Health for NASDAQ:NBIX

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:NBIX has earned a 7 out of 10:

NBIX has an Altman-Z score of 9.72. This indicates that NBIX is financially healthy and has little risk of bankruptcy at the moment.
NBIX has a better Altman-Z score (9.72) than 86.54% of its industry peers.
NBIX has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
A Current Ratio of 2.39 indicates that NBIX has no problem at all paying its short term obligations.
NBIX has a Quick Ratio of 2.34. This indicates that NBIX 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:NBIX scores a 8 out of 10:

With an excellent Return On Assets value of 6.71%, NBIX belongs to the best of the industry, outperforming 96.51% of the companies in the same industry.
NBIX has a better Return On Equity (9.54%) than 95.68% of its industry peers.
With an excellent Return On Invested Capital value of 12.95%, NBIX belongs to the best of the industry, outperforming 97.01% of the companies in the same industry.
The 3 year average ROIC (12.37%) for NBIX is below the current ROIC(12.95%), indicating increased profibility in the last year.
NBIX's Profit Margin of 10.71% is amongst the best of the industry. NBIX outperforms 96.18% of its industry peers.
In the last couple of years the Profit Margin of NBIX has grown nicely.
Looking at the Operating Margin, with a value of 19.50%, NBIX belongs to the top of the industry, outperforming 96.68% of the companies in the same industry.
NBIX has a Gross Margin of 97.82%. This is amongst the best in the industry. NBIX outperforms 97.34% of its industry peers.

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

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

Keep in mind

This article should in no way be interpreted as advice in any way. 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.