ACADIA PHARMACEUTICALS INC (NASDAQ:ACAD) - A Promising Affordable Growth Stock

ACADIA PHARMACEUTICALS INC (NASDAQ:ACAD) stands out as an affordable growth candidate based on our screening criteria. The company, which focuses on treatments for central nervous system disorders, shows strong growth potential while maintaining reasonable valuation metrics. Its financial health and profitability also contribute to its appeal for investors seeking balanced opportunities.

Growth Prospects

ACADIA PHARMACEUTICALS demonstrates impressive growth, with key highlights including:

• Earnings Per Share (EPS) growth of 5,000% over the past year.
• Revenue growth of 22.39% in the last year, with an average annual growth rate of 23.08% over recent years.
• Expected future EPS growth of 43.51% annually, supported by a projected 10.46% yearly revenue increase.

These metrics indicate a company expanding rapidly, particularly in earnings, which is a positive sign for growth-oriented investors.

Valuation Considerations

Despite its strong growth, ACADIA PHARMACEUTICALS remains reasonably valued compared to industry peers:

• The Price/Earnings (P/E) ratio of 45.51 appears high in absolute terms but is cheaper than 92.49% of biotechnology industry peers.
• The Forward P/E of 25.42 is in line with the S&P 500 average, suggesting a balanced outlook.
• Enterprise Value to EBITDA and Price/Free Cash Flow ratios are also favorable relative to competitors.

Financial Health & Profitability

The company maintains solid financial health, with no outstanding debt and an Altman-Z score of 5.14, indicating low bankruptcy risk. Profitability metrics are mixed but include strong points:

• Return on Equity (ROE) of 29.93%, outperforming 97.67% of industry peers.
• Gross Margin of 92.08%, placing it among the top performers in its sector.
• Recent profitability improvements, though past performance includes some volatility.

Our Affordable Growth screener lists more stocks with similar characteristics and is updated daily.
For a deeper dive, review the full fundamental report on ACADIA PHARMACEUTICALS.

Disclaimer

This is not investing advice. The observations here are based on data available at the time of writing. Always conduct your own research before making investment decisions.