INCYTE CORP (NASDAQ:INCY), an undervalued stock with good fundamentals.

Our stock screening tool has identified INCYTE CORP (NASDAQ:INCY) as an undervalued gem with strong fundamentals. INCY boasts decent financial health and profitability while maintaining an attractive price point. We'll break it down further.

Deciphering INCY's Valuation Rating

To assess a stock's valuation, ChartMill utilizes a Valuation Rating on a scale of 0 to 10. This comprehensive assessment considers various valuation aspects, comparing price to earnings and cash flows, while factoring in profitability and growth. INCY has achieved a 8 out of 10:

• 93.96% of the companies in the same industry are more expensive than INCY, based on the Price/Earnings ratio.
• Based on the Price/Forward Earnings ratio of 8.51, the valuation of INCY can be described as reasonable.
• Based on the Price/Forward Earnings ratio, INCY is valued cheaper than 97.16% of the companies in the same industry.
• INCY's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 20.35.
• Based on the Enterprise Value to EBITDA ratio, INCY is valued cheaper than 93.25% of the companies in the same industry.
• INCY's Price/Free Cash Flow ratio is rather cheap when compared to the industry. INCY is cheaper than 93.78% of the companies in the same industry.
• The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• INCY has a very decent profitability rating, which may justify a higher PE ratio.
• A more expensive valuation may be justified as INCY's earnings are expected to grow with 87.87% in the coming years.

How do we evaluate the Profitability for INCY?

Discover ChartMill's exclusive Profitability Rating, a proprietary metric that assesses stocks on a scale of 0 to 10. It takes into consideration various profitability ratios and margins, both in absolute terms and relative to industry peers. Notably, INCY has achieved a 7:

• Looking at the Return On Assets, with a value of 0.60%, INCY belongs to the top of the industry, outperforming 90.76% of the companies in the same industry.
• INCY has a Return On Equity of 0.95%. This is amongst the best in the industry. INCY outperforms 91.47% of its industry peers.
• The Return On Invested Capital of INCY (2.32%) is better than 92.72% of its industry peers.
• The last Return On Invested Capital (2.32%) for INCY is well below the 3 year average (7.24%), which needs to be investigated, but indicates that INCY had better years and this may not be a problem.
• The Profit Margin of INCY (0.77%) is better than 91.47% of its industry peers.
• With an excellent Operating Margin value of 2.63%, INCY belongs to the best of the industry, outperforming 92.72% of the companies in the same industry.
• Looking at the Gross Margin, with a value of 93.20%, INCY belongs to the top of the industry, outperforming 93.25% of the companies in the same industry.

Assessing Health Metrics for INCY

ChartMill employs its own Health Rating for stock assessment. This rating, ranging from 0 to 10, is calculated by examining various liquidity and solvency ratios. In the case of INCY, the assigned 6 reflects its health status:

• INCY has an Altman-Z score of 4.39. This indicates that INCY is financially healthy and has little risk of bankruptcy at the moment.
• INCY's Altman-Z score of 4.39 is fine compared to the rest of the industry. INCY outperforms 79.75% of its industry peers.
• INCY has a debt to FCF ratio of 0.15. This is a very positive value and a sign of high solvency as it would only need 0.15 years to pay back of all of its debts.
• INCY has a better Debt to FCF ratio (0.15) than 96.80% of its industry peers.
• A Debt/Equity ratio of 0.01 indicates that INCY is not too dependend on debt financing.

Growth Assessment of INCY

Every stock receives a Growth Rating from ChartMill, ranging from 0 to 10. This rating assesses various growth aspects, including historical and projected EPS and revenue growth. INCY boasts a 4 out of 10:

• INCY shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 17.13%.
• The Revenue has been growing by 14.46% on average over the past years. This is quite good.
• The Earnings Per Share is expected to grow by 25.93% on average over the next years. This is a very strong growth
• When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.

Our Decent Value screener lists more Decent Value stocks and is updated daily.

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

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.