ACADIA PHARMACEUTICALS INC (NASDAQ:ACAD) - A Promising Growth Stock at a Reasonable Valuation

ACADIA PHARMACEUTICALS INC (NASDAQ:ACAD) was identified as an affordable growth stock by our screening process. The company demonstrates strong growth potential while maintaining reasonable valuation metrics, along with solid financial health and profitability. Below, we break down why ACAD stands out in these areas.

Growth Prospects

ACADIA PHARMACEUTICALS has shown impressive growth recently:

• Revenue increased by 31.85% over the past year.
• Earnings Per Share (EPS) surged by 5000% year-over-year.
• Analysts expect EPS to grow by 42.50% annually in the coming years.

These figures place ACAD well above many peers in the biotechnology sector, making it a compelling candidate for growth investors.

Valuation

Despite its strong growth, ACAD remains reasonably priced compared to industry standards:

• The Price/Earnings (P/E) ratio of 44.59 is lower than 92.34% of its industry peers.
• Its Enterprise Value to EBITDA and Price/Free Cash Flow ratios are also favorable, ranking cheaper than over 94% of competitors.
• While the P/E is higher than the S&P 500 average, the company’s growth trajectory may justify the premium.

Financial Health & Profitability

ACADIA PHARMACEUTICALS maintains a solid financial position:

• No outstanding debt, contributing to a strong balance sheet.
• Altman-Z score of 3.81 indicates low bankruptcy risk.
• Profit margins are strong, with a Gross Margin of 91.46% and Operating Margin of 8.80%, outperforming most industry competitors.

While profitability has been inconsistent in past years, recent improvements suggest a positive trend.

For a deeper look, review the full fundamental analysis of ACADIA PHARMACEUTICALS.

Our Affordable Growth screener lists more stocks with similar characteristics and is updated daily.

##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.