NEUROCRINE BIOSCIENCES INC (NASDAQ:NBIX) Presents a Compelling Growth and Breakout Opportunity

A screening method that uses both fundamental and technical analysis can help find companies with good basic business measures while also finding good entry points based on price movement. This method looks for growth stocks that are not only financially sound and profitable but are also showing positive chart formations that might come before more price gains. The plan aims to capture the momentum of a stock moving out of a period of sideways trading, supported by the belief that its basic growth story is still strong.

NEUROCRINE BIOSCIENCES INC (NASDAQ:NBIX) represents a good example of this method in use. The company, a neuroscience-focused biopharmaceutical firm, has created a group of commercial products and a solid pipeline aimed at neurological and neuropsychiatric disorders.

Fundamental Growth Assessment

The main part of this plan is finding companies with very good growth paths and solid finances. Neurocrine's basic profile, as detailed in its fundamental analysis report, shows a good base that fits well with growth investing ideas. The company gets a high overall basic rating of 7 out of 10, with especially good scores in growth and profitability.

• Very Good Growth Measures: Neurocrine shows strong revenue and earnings increases. Its Revenue has grown by 24.48% on average over recent years, and it is expected to keep a good forward EPS growth of 36.58% each year. This speeding up top and bottom-line growth is a main feature looked for in growth stocks.
• Excellent Profitability: The company has a Profit Margin of 13.88% and an Operating Margin of 19.89%, doing better than over 93% of its biotechnology industry peers. High profitability points to a scalable business model and efficient management, which is important for maintaining long-term growth.
• Good Financial Health: With a top-level Health rating of 7, Neurocrine shows a low-risk balance sheet for a growth company. A main positive is the total lack of debt, giving important financial room to fund research and operate in the changeable biotech field without the weight of interest payments.

Technical Setup and Breakout Possibility

While basic analysis gives the "why" for a long-term investment, technical analysis helps find the "when" for a possible entry. Neurocrine's technical analysis report points to a positive setup, getting a Setup Rating of 7 out of 10. The stock is currently moving sideways within a set range, forming a base for its next possible move.

• Positive Sideways Movement: After a large upward move over the past six months, the stock has started a phase of sideways movement. This stop lets the stock absorb its earlier gains and can sometimes be a starting point for the next upward move.
• Clear Support and Resistance: The technical analysis finds a clear support area between $136.11 and $138.98, made by a mix of important moving averages and trendlines. Staying above this level points to basic strength. At the same time, resistance is fairly light just above the present price, with the next important level around $153.
• Positive Long-Term Direction: The long-term direction for NBIX stays positive, with its price trading above important rising moving averages (SMA50, SMA100, SMA200). This shows that the wider market feeling for the stock is still positive.

A Unified Investment Thesis

The mix of Neurocrine's solid basic growth and its positive technical position forms a good story. The company's fast revenue growth and high profitability confirm its place as a real growth stock, meeting the qualitative and quantitative standards needed for long-term success. At the same time, the technical setup suggests that after a time of sideways movement, the stock might be getting ready to continue its upward direction, giving a possibly good risk/reward chance for investors who use this mixed analytical method.

For investors interested in finding other companies that fit this plan of good basics paired with positive technical setups, more research can be done using the predefined Strong Growth Stock Technical Setups Screen.

Disclaimer: This article is for informational purposes only and does not constitute financial advice, a recommendation, or an offer or solicitation to buy or sell any securities. The content presented is based on data believed to be reliable but is not guaranteed. Investors should conduct their own independent research and consult with a qualified financial advisor before making any investment decisions. Past performance is not indicative of future results.