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EXELIXIS INC (NASDAQ:EXEL) - An Undervalued Biotech Stock With Strong Fundamentals

By Mill Chart

Last update: Jul 2, 2025

EXELIXIS INC (NASDAQ:EXEL) was identified by our Decent Value stock screener as a company with solid fundamentals and an attractive valuation. The biotech firm specializes in developing treatments for difficult-to-treat cancers and currently has four marketed products, including its flagship drug cabozantinib.

EXELIXIS stock chart

Valuation Highlights

EXEL scores an 8/10 on valuation, indicating it may be priced below its intrinsic value:

  • P/E Ratio: At 19.83, it trades below both the industry average (72.42) and the S&P 500 (27.21).
  • Forward P/E: 16.44, cheaper than 93.9% of biotech peers.
  • Enterprise Value/EBITDA: Ranks better than 96% of the industry, suggesting undervaluation.
  • Price/Free Cash Flow: More affordable than 95% of competitors.

Financial Health

With a 9/10 health rating, EXEL maintains a strong balance sheet:

  • No Debt: A rare advantage in biotech, eliminating interest expenses and default risk.
  • Liquidity: Current ratio of 3.50 and quick ratio of 3.44 ensure short-term obligations are easily met.
  • Altman-Z Score: 12.21 signals minimal bankruptcy risk, outperforming 89% of peers.

Profitability Strengths

The company earns an 8/10 profitability score:

  • Margins: Gross margin of 96.78% and operating margin of 35.43% rank in the top 3% of the industry.
  • Returns: ROA of 22.68% and ROE of 30.20% outperform 98% and 97% of biotech firms, respectively.
  • Consistent Earnings: Profitable for five consecutive years with positive operating cash flow.

Growth Potential

EXEL’s 8/10 growth rating reflects strong expansion:

  • Revenue Growth: Up 24.5% YoY, with a 17.5% 5-year CAGR.
  • EPS Growth: Surged 205.6% over the past year, with a 12.7% 5-year average.
  • Future Estimates: Analysts project 25.8% annual EPS growth and 11.2% revenue growth.

Our Decent Value screener lists more stocks with similar characteristics.
For a deeper dive, review the full fundamental analysis of EXEL.

Disclaimer

This is not investment advice. Always conduct your own research before making financial decisions.