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NASDAQ:ALKS stands out as a stock that provides good value for the fundamentals it showcases.

By Mill Chart

Last update: Mar 5, 2024

Consider ALKERMES PLC (NASDAQ:ALKS) as a top value stock, identified by our stock screening tool. NASDAQ:ALKS shines in terms of profitability, solvency, and liquidity, all while remaining very reasonably priced. Let's dive deeper into the analysis.

Valuation Assessment of NASDAQ:ALKS

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:ALKS scores a 7 out of 10:

  • Based on the Price/Earnings ratio, ALKS is valued cheaper than 96.63% of the companies in the same industry.
  • 97.98% of the companies in the same industry are more expensive than ALKS, based on the Price/Forward Earnings ratio.
  • Compared to an average S&P500 Price/Forward Earnings ratio of 21.91, ALKS is valued a bit cheaper.
  • ALKS's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. ALKS is cheaper than 98.15% of the companies in the same industry.
  • Based on the Price/Free Cash Flow ratio, ALKS is valued cheaper than 97.98% of the companies in the same industry.
  • ALKS's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
  • The decent profitability rating of ALKS may justify a higher PE ratio.
  • ALKS's earnings are expected to grow with 26.05% in the coming years. This may justify a more expensive valuation.

Assessing Profitability for NASDAQ:ALKS

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:ALKS was assigned a score of 6 for profitability:

  • Looking at the Return On Assets, with a value of 16.66%, ALKS belongs to the top of the industry, outperforming 98.99% of the companies in the same industry.
  • The Return On Equity of ALKS (29.59%) is better than 98.32% of its industry peers.
  • ALKS's Return On Invested Capital of 20.54% is amongst the best of the industry. ALKS outperforms 99.16% of its industry peers.
  • ALKS's Profit Margin of 21.39% is amongst the best of the industry. ALKS outperforms 97.31% of its industry peers.
  • ALKS has a better Operating Margin (25.25%) than 97.64% of its industry peers.
  • With an excellent Gross Margin value of 84.78%, ALKS belongs to the best of the industry, outperforming 88.55% of the companies in the same industry.

Understanding NASDAQ:ALKS's Health Score

ChartMill assigns a Health Rating to every stock. This score ranges from 0 to 10 and evaluates the different health aspects like liquidity and solvency, both absolutely, but also relative to the industry peers. NASDAQ:ALKS scores a 7 out of 10:

  • ALKS has an Altman-Z score of 4.30. This indicates that ALKS is financially healthy and has little risk of bankruptcy at the moment.
  • Looking at the Altman-Z score, with a value of 4.30, ALKS is in the better half of the industry, outperforming 74.92% of the companies in the same industry.
  • ALKS has a debt to FCF ratio of 0.82. This is a very positive value and a sign of high solvency as it would only need 0.82 years to pay back of all of its debts.
  • Looking at the Debt to FCF ratio, with a value of 0.82, ALKS belongs to the top of the industry, outperforming 95.79% of the companies in the same industry.
  • A Debt/Equity ratio of 0.24 indicates that ALKS is not too dependend on debt financing.
  • Although ALKS does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
  • ALKS has a Current Ratio of 2.86. This indicates that ALKS is financially healthy and has no problem in meeting its short term obligations.
  • ALKS has a Quick Ratio of 2.50. This indicates that ALKS is financially healthy and has no problem in meeting its short term obligations.

Analyzing Growth Metrics

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:ALKS has achieved a 6 out of 10:

  • The Earnings Per Share has grown by an impressive 317.65% over the past year.
  • The Earnings Per Share has been growing by 18.41% on average over the past years. This is quite good.
  • The Revenue has grown by 49.61% in the past year. This is a very strong growth!
  • Measured over the past years, ALKS shows a quite strong growth in Revenue. The Revenue has been growing by 8.74% on average per year.
  • Based on estimates for the next years, ALKS will show a quite strong growth in Earnings Per Share. The EPS will grow by 17.76% on average per year.

More Decent Value stocks can be found in our Decent Value screener.

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

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.

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ALKERMES PLC

NASDAQ:ALKS (5/24/2024, 7:13:31 PM)

After market: 24.02 0 (0%)

24.02

+0.02 (+0.08%)

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