REGENERON PHARMACEUTICALS (NASDAQ:REGN) - A Potential Undervalued Biotech Stock

REGENERON PHARMACEUTICALS (NASDAQ:REGN) was identified by our Decent Value stock screener as a company with strong fundamentals and an attractive valuation. The biotech firm demonstrates solid profitability and financial health while trading at a reasonable price relative to its industry peers. Below, we examine why REGN may appeal to value-focused investors.

Valuation

REGENERON PHARMACEUTICALS appears undervalued compared to both its industry and the broader market:

• P/E Ratio: At 12.35, REGN trades below the industry average (76.66) and the S&P 500 (27.45).
• Forward P/E: 13.51 suggests the stock remains reasonably priced relative to future earnings.
• Price/Free Cash Flow: REGN is cheaper than 94% of its biotech peers.
• Enterprise Value/EBITDA: Also favorable, indicating a discount relative to industry standards.

Financial Health

The company maintains a strong balance sheet:

• Low Debt: A Debt/Equity ratio of 0.09 reflects minimal leverage.
• High Solvency: An Altman-Z score of 6.73 signals low bankruptcy risk.
• Liquidity: Current and Quick Ratios (4.93 and 4.03, respectively) suggest ample short-term financial flexibility.

Profitability

REGN excels in profitability metrics:

• Profit Margin: 31.94% outperforms 97% of biotech firms.
• Return on Equity (ROE): 15.31% places it in the top 5% of the industry.
• Operating Margin: 28.85% is well above most competitors.

Growth

While growth is moderate, it remains stable:

• Revenue Growth: 7.52% YoY, with a 5-year average of 12.55%.
• EPS Growth: 2.47% YoY, though the 5-year average is stronger at 13.12%.
• Future estimates project steady, albeit slower, growth in both revenue and earnings.

For a deeper dive into REGN’s fundamentals, review the full report here.

Our Decent Value screener lists more stocks with strong valuations and solid fundamentals, updated daily.

Disclaimer

This is not investing advice! The article highlights observations at the time of writing, but you should conduct your own analysis before making investment decisions.