Don't overlook NASDAQ:NBIX—it's a hidden gem with strong fundamentals and an attractive price tag.

NEUROCRINE BIOSCIENCES INC (NASDAQ:NBIX) was identified as a decent value stock by our stock screener. NASDAQ:NBIX scores well on profitability, solvency and liquidity. At the same time it seems to be priced very reasonably. We'll explore this a bit deeper below.

Looking at the Valuation

ChartMill assigns a proprietary Valuation Rating to each stock. The score is computed by evaluating various valuation aspects, like price to earnings and free cash flow, both absolutely as relative to the market and industry. NASDAQ:NBIX was assigned a score of 7 for valuation:

• Based on the Price/Earnings ratio, NBIX is valued cheaper than 95.25% of the companies in the same industry.
• Based on the Price/Forward Earnings ratio, NBIX is valued cheaper than 95.25% of the companies in the same industry.
• Based on the Enterprise Value to EBITDA ratio, NBIX is valued cheaply inside the industry as 95.77% of the companies are valued more expensively.
• NBIX's Price/Free Cash Flow ratio is rather cheap when compared to the industry. NBIX is cheaper than 96.83% of the companies in the same industry.
• NBIX's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• NBIX has an outstanding profitability rating, which may justify a higher PE ratio.
• NBIX's earnings are expected to grow with 57.04% in the coming years. This may justify a more expensive valuation.

Understanding NASDAQ:NBIX's Profitability

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:NBIX was assigned a score of 9 for profitability:

• NBIX has a Return On Assets of 10.26%. This is amongst the best in the industry. NBIX outperforms 97.01% of its industry peers.
• NBIX has a Return On Equity of 13.52%. This is amongst the best in the industry. NBIX outperforms 96.65% of its industry peers.
• NBIX has a Return On Invested Capital of 13.81%. This is amongst the best in the industry. NBIX outperforms 96.83% of its industry peers.
• The last Return On Invested Capital (13.81%) for NBIX is above the 3 year average (9.89%), which is a sign of increasing profitability.
• With an excellent Profit Margin value of 16.00%, NBIX belongs to the best of the industry, outperforming 97.18% of the companies in the same industry.
• NBIX's Profit Margin has improved in the last couple of years.
• With an excellent Operating Margin value of 25.70%, NBIX belongs to the best of the industry, outperforming 97.89% of the companies in the same industry.
• In the last couple of years the Operating Margin of NBIX has grown nicely.
• NBIX has a Gross Margin of 98.28%. This is amongst the best in the industry. NBIX outperforms 97.89% of its industry peers.

Health Examination for NASDAQ:NBIX

ChartMill employs its own Health Rating for stock assessment. This rating, ranging from 0 to 10, is calculated by examining various liquidity and solvency ratios. In the case of NASDAQ:NBIX, the assigned 8 reflects its health status:

• NBIX has an Altman-Z score of 10.92. This indicates that NBIX is financially healthy and has little risk of bankruptcy at the moment.
• NBIX has a better Altman-Z score (10.92) than 86.97% 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 4.19 indicates that NBIX has no problem at all paying its short term obligations.
• A Quick Ratio of 4.08 indicates that NBIX has no problem at all paying its short term obligations.

Evaluating Growth: NASDAQ:NBIX

Every stock receives a Growth Rating from ChartMill, ranging from 0 to 10. This rating assesses various growth aspects, including historical and projected EPS and revenue growth. NASDAQ:NBIX boasts a 9 out of 10:

• The Earnings Per Share has grown by an impressive 91.33% over the past year.
• NBIX shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 70.09% yearly.
• NBIX shows a strong growth in Revenue. In the last year, the Revenue has grown by 26.69%.
• The Revenue has been growing by 33.13% on average over the past years. This is a very strong growth!
• NBIX is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 44.72% yearly.
• NBIX is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 15.24% yearly.

Every day, new Decent Value stocks can be found on ChartMill in our Decent Value screener.

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

Keep in mind

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.