Taking everything into account, HZNP scores 6 out of 10 in our fundamental rating. HZNP was compared to 525 industry peers in the Biotechnology industry. HZNP has an excellent financial health rating, but there are some minor concerns on its profitability. HZNP has a decent growth rate and is not valued too expensively.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

In the past year HZNP was profitable.
HZNP had a positive operating cash flow in the past year.

1.2 Ratios

With an excellent Return On Assets value of 4.71%, HZNP belongs to the best of the industry, outperforming 95.21% of the companies in the same industry.
Looking at the Return On Equity, with a value of 8.25%, HZNP belongs to the top of the industry, outperforming 95.38% of the companies in the same industry.
With an excellent Return On Invested Capital value of 5.35%, HZNP belongs to the best of the industry, outperforming 95.87% of the companies in the same industry.
HZNP had an Average Return On Invested Capital over the past 3 years of 6.68%. This is significantly below the industry average of 18.07%.

		Industry Rank	Sector Rank
ROA	4.71%
ROE	8.25%
ROIC	5.35%

ROA(3y)6.1%

ROA(5y)6.05%

ROE(3y)10.47%

ROE(5y)10.88%

ROIC(3y)6.68%

ROIC(5y)4.8%

1.3 Margins

With an excellent Profit Margin value of 12.02%, HZNP belongs to the best of the industry, outperforming 96.04% of the companies in the same industry.
HZNP's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 15.58%, HZNP belongs to the top of the industry, outperforming 96.53% of the companies in the same industry.
In the last couple of years the Operating Margin of HZNP has grown nicely.
HZNP's Gross Margin of 75.21% is amongst the best of the industry. HZNP outperforms 84.49% of its industry peers.
HZNP's Gross Margin has improved in the last couple of years.

		Industry Rank	Sector Rank
OM	15.58%
PM (TTM)	12.02%
GM	75.21%

OM growth 3Y23.86%

OM growth 5YN/A

PM growth 3Y-31.18%

PM growth 5YN/A

GM growth 3Y1.14%

GM growth 5Y6.97%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

HZNP has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
HZNP has about the same amout of shares outstanding than it did 1 year ago.
Compared to 1 year ago, HZNP has an improved debt to assets ratio.

2.2 Solvency

HZNP has an Altman-Z score of 5.10. This indicates that HZNP is financially healthy and has little risk of bankruptcy at the moment.
HZNP has a Altman-Z score of 5.10. This is amongst the best in the industry. HZNP outperforms 81.35% of its industry peers.
HZNP has a debt to FCF ratio of 2.67. This is a good value and a sign of high solvency as HZNP would need 2.67 years to pay back of all of its debts.
The Debt to FCF ratio of HZNP (2.67) is better than 95.54% of its industry peers.
A Debt/Equity ratio of 0.48 indicates that HZNP is not too dependend on debt financing.
With a Debt to Equity ratio value of 0.48, HZNP is not doing good in the industry: 74.92% of the companies in the same industry are doing better.

		Industry Rank	Sector Rank
Debt/Equity	0.48
Debt/FCF	2.67
Altman-Z	5.1

ROIC/WACC0.75

WACC7.16%

2.3 Liquidity

A Current Ratio of 4.27 indicates that HZNP has no problem at all paying its short term obligations.
HZNP has a Current ratio (4.27) which is in line with its industry peers.
A Quick Ratio of 4.09 indicates that HZNP has no problem at all paying its short term obligations.
With a Quick ratio value of 4.09, HZNP perfoms like the industry average, outperforming 40.92% of the companies in the same industry.

		Industry Rank	Sector Rank
Current Ratio	4.27
Quick Ratio	4.09

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The earnings per share for HZNP have decreased strongly by -19.39% in the last year.
Measured over the past years, HZNP shows a very strong growth in Earnings Per Share. The EPS has been growing by 33.01% on average per year.
The Revenue has decreased by -4.42% in the past year.
Measured over the past years, HZNP shows a very strong growth in Revenue. The Revenue has been growing by 28.00% on average per year.

EPS 1Y (TTM)-19.39%

EPS 3Y34.76%

EPS 5Y33.01%

EPS Q2Q%12.15%

Revenue 1Y (TTM)-4.42%

Revenue growth 3Y40.8%

Revenue growth 5Y28%

Sales Q2Q%7.82%

3.2 Future

Based on estimates for the next years, HZNP will show a quite strong growth in Earnings Per Share. The EPS will grow by 15.92% on average per year.
The Revenue is expected to grow by 9.94% on average over the next years. This is quite good.

EPS Next Y-5.01%

EPS Next 2Y8.89%

EPS Next 3Y11.9%

EPS Next 5Y15.92%

Revenue Next Year5.55%

Revenue Next 2Y9.53%

Revenue Next 3Y10.34%

Revenue Next 5Y9.94%

3.3 Evolution

The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.

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4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 25.90, HZNP can be considered very expensive at the moment.
HZNP's Price/Earnings ratio is rather cheap when compared to the industry. HZNP is cheaper than 95.54% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 27.32. HZNP is around the same levels.
With a Price/Forward Earnings ratio of 20.14, HZNP is valued on the expensive side.
96.53% of the companies in the same industry are more expensive than HZNP, based on the Price/Forward Earnings ratio.
HZNP is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 24.32, which is the current average of the S&P500 Index.

		Industry Rank	Sector Rank
PE	25.9
Fwd PE	20.14

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of HZNP indicates a rather cheap valuation: HZNP is cheaper than 94.88% of the companies listed in the same industry.
HZNP's Price/Free Cash Flow ratio is rather cheap when compared to the industry. HZNP is cheaper than 96.37% of the companies in the same industry.