argenx SE - ADR (NASDAQ:ARGX) Fits Louis Navellier's 'Little Book' Growth Strategy

In the world of growth investing, few strategies have kept their importance as well as the structure presented by Louis Navellier in his 2007 work, "The Little Book That Makes You Rich." The method highlights finding companies showing solid, quickening growth through eight particular fundamental measures, such as positive earnings revisions, increasing margins, strong cash flow, and high returns on equity. This organized method seeks to find equities set for major price gains by concentrating on operational quality and rising momentum in financial numbers. One security now satisfying these strict measures is argenx SE - ADR (NASDAQ:ARGX), a worldwide immunology company creating antibody treatments for serious autoimmune diseases.

Earnings Momentum and Revisions

The Little Book strategy gives major importance to analyst sentiment and earnings performance, both areas where argenx does very well. The company has shown notable earnings strength with:

• A 62.66% upward revision in next-quarter EPS estimates over the past three months
• Three positive earnings surprises in the last four quarters
• An average earnings beat of 3,962.36% against analyst expectations

These numbers are especially important to Navellier's method because steady earnings outperformance makes analysts regularly improve their predictions, creating a positive cycle of increasing expectations and possibly higher valuations. The large earnings revisions show rising confidence among analysts about argenx's short-term future.

Strong Growth Metrics

Quickening growth is central to the Little Book method, and argenx gives outstanding results in many areas:

• Quarterly revenue growth of 97.62% year-over-year
• Annual revenue growth of 56.80%
• Quarterly EPS growth of 731.11% year-over-year
• Annual EPS growth of 345.45%

The company's notable growth rates meet Navellier's needs for both rising sales and increasing earnings. More importantly, the quickening in growth rates, particularly the major improvement in quarterly EPS growth from 126.63% to 731.11, points to the kind of momentum that growth investors look for.

Profitability and Efficiency Gains

Navellier's strategy highlights not only growth, but profitable, efficient growth. argenx displays excellent performance in these areas:

• Operating margin growth of 168.24% over the past year
• Return on equity of 21.00%
• Free cash flow growth of 140.74% annually

The rising operating margin shows the company is growing revenue quicker than costs, bettering profitability even as sales rise. The high return on equity shows efficient use of shareholder capital, while solid cash flow growth gives financial flexibility to fund future expansion without too much debt or equity dilution.

Fundamental Analysis Overview

According to ChartMill's detailed fundamental analysis, argenx presents a strong profile for growth investors. The company gets an overall fundamental rating of 6 out of 10, with especially high scores in growth (8/10) and health (7/10). While valuation remains high with a P/E ratio of 82.74, this is normal among fast-growth biotechnology companies and seems reasonable given the exceptional growth path. The analysis notes that argenx's profitability, while currently moderate, shows major improvement trends, and the company keeps very good solvency and liquidity ratios.

Investment Considerations

While argenx meets most Little Book measures very well, investors should note that the company works in the changeable biotechnology sector, where regulatory news and clinical trial results can greatly affect valuations. The company's negative earnings history in earlier years, though showing major recent improvement, reflects the common lifecycle of development-stage biopharmaceutical companies moving to commercialization.

The present market environment, with both short-term and long-term S&P 500 trends positive, usually supports growth investing strategies. However, biotechnology stocks often show higher changeability than the wider market, needing investors to keep suitable risk tolerance and position size.

For investors interested in finding other companies meeting the Little Book measures, more screening results are available through our pre-configured screener.

Disclaimer: This analysis is given for informational purposes only and does not make up investment advice, a recommendation, or an offer to buy or sell any securities. Investors should do their own research and talk with a qualified financial advisor before making investment decisions.