INCYTE CORP (NASDAQ:INCY) was identified as a decent value stock through our screening process. The company combines a strong valuation rating with solid profitability and financial health, making it an interesting candidate for value investors. Below, we examine why INCY stands out.
Valuation
INCY scores an 8 out of 10 on valuation, indicating it is attractively priced relative to its fundamentals. Key points include:
- Price/Forward Earnings of 9.78 – Well below the industry average of 57.62 and the S&P 500 average of 22.19.
- Enterprise Value/EBITDA – Cheaper than 93% of its biotechnology peers.
- PEG Ratio – Suggests the stock is reasonably priced when accounting for expected earnings growth.
Profitability
With a profitability rating of 7, INCY demonstrates strong margins and returns:
- Operating Margin of 5.39% – Better than 92.82% of industry competitors.
- Gross Margin of 93.19% – Among the highest in the sector.
- Return on Invested Capital (ROIC) of 4.67% – Outperforms 93% of peers.
Financial Health
The company earns a 7 in financial health, supported by:
- Low Debt Levels – Debt/Equity ratio of 0.01 indicates minimal leverage.
- Strong Solvency – A Debt-to-FCF ratio of 0.12 suggests ample cash flow to cover obligations.
- Positive Cash Flow – Consistent operating cash flow over the past five years.
Growth Outlook
While past earnings growth has been weak, future expectations are more promising:
- Expected EPS Growth of 27.55% annually – A rebound from recent declines.
- Revenue Growth of 14.46% (5-year average) – Reflects steady business expansion.
Our Decent Value screener lists more stocks with similar characteristics and is updated daily.
For a deeper dive, review the full fundamental report on INCY.
Disclaimer
This is not investment advice. Always conduct your own research before making investment decisions.
