HALOZYME THERAPEUTICS INC (NASDAQ:HALO) Fits Louis Navellier’s High-Growth Stock Criteria

Louis Navellier’s The Little Book That Makes You Rich presents a structured method for finding high-growth stocks using eight key factors. These rules examine earnings updates, sales and profit increases, wider operating margins, solid cash flow, and return on equity, metrics that together show a company’s potential to maintain and boost profits. The approach aims to spot stocks with strong upward trends, supported by improving financials rather than market speculation.

One stock that fits these factors is HALOZYME THERAPEUTICS INC (NASDAQ:HALO). The biopharmaceutical technology firm, recognized for its ENHANZE drug delivery system, shows steady growth across several metrics highlighted in Navellier’s strategy.

How HALO Matches Navellier’s Growth Factors

1. Upward Earnings Updates
   Analysts have increased HALO’s next-quarter EPS projections by 11.05% over the last three months, showing rising confidence in its short-term earnings. This matches Navellier’s focus on positive updates as a sign of future success.

2. Regular Earnings Beats
   HALO has exceeded EPS forecasts in each of the past four quarters, with an average beat of 16.48%. Consistent positive surprises suggest the company often delivers better results than expected, a trait of well-run growth stocks.

3. Rising Sales Growth
   Revenue growth remains solid, with a 22.44% year-over-year rise and a 40.79% increase in the latest quarter compared to the same period last year. Navellier values firms with growing sales, as revenue growth often leads to higher profits.

4. Wider Operating Margins
   HALO’s operating margin has expanded by 24.51% over the past year, showing better cost control alongside revenue gains. This factor is important in Navellier’s method, as wider margins point to scalable profits.

5. Healthy Cash Flow
   Free cash flow jumped 88.07% year-over-year, highlighting HALO’s ability to fund growth from its operations. Strong cash flow reduces the need for external funding and supports reinvestment, key for long-term growth.

6. Strong Earnings Growth
   HALO’s EPS rose 58.41% year-over-year, with quarterly growth speeding up to 69.23%. Navellier’s strategy prefers companies where earnings growth outpaces sales growth, indicating efficient operations.

7. Positive Earnings Trend
   The latest quarterly EPS growth (69.23%) far surpasses the year-ago quarter (22.97%), showing faster profit gains—a central part of Navellier’s momentum-focused approach.

8. High Return on Equity (ROE)
   HALO’s ROE of 100.64% is impressive, ranking it among the top in its biotechnology sector. Navellier sees high ROE as proof of effective capital use, a common feature of leading growth stocks.

Financial Strength Beyond the Numbers

HALO’s fundamental analysis report further supports its appeal, with an overall score of 8/10. Key points include:

• Profitability: Excellent margins (55.10% operating margin) and top-tier returns (ROE >100%).
• Valuation: Trading at a P/E of 11.74, HALO seems undervalued compared to its industry and the S&P 500.
• Financial Health: Strong liquidity (current ratio of 8.39) and reasonable debt levels, despite a higher debt-to-equity ratio typical of growing biotech companies.

Discovering Similar Stocks

For investors looking for other stocks that meet Navellier’s growth factors, the preconfigured screen provides a selected list of options. Regular screening can help uncover promising growth stocks before they gain widespread attention.

Disclaimer: This article is not investment advice. Always conduct your own research or consult a financial advisor before making investment decisions.