UNITED THERAPEUTICS CORP (NASDAQ:UTHR) was identified as a decent value stock by our fundamental screening process. The company shows strong profitability and financial health while trading at a reasonable valuation, making it an interesting candidate for value investors.
Key Strengths
Valuation (Score: 9/10)
- The stock trades at a P/E ratio of 11.61, significantly below both the industry average (72.42) and the S&P500 (27.21).
- Its forward P/E of 9.88 suggests further upside potential.
- The Enterprise Value/EBITDA ratio indicates UTHR is cheaper than 98.7% of its biotech peers.
Profitability (Score: 9/10)
- Exceptional margins: 40.4% net profit margin and 49.3% operating margin, outperforming most competitors.
- Strong returns: ROA of 15.6% and ROE of 17.8%, placing it in the top 4% of the industry.
Financial Health (Score: 8/10)
- No debt on the balance sheet, reducing financial risk.
- High liquidity with a current ratio of 5.46 and quick ratio of 5.23.
- Altman-Z score of 11.28 signals low bankruptcy risk.
Growth (Score: 5/10)
- Revenue grew 19.9% over the past year, with a 5-year CAGR of 14.7%.
- EPS growth of 18.5% (past year) and 16.9% (5-year average).
- Future EPS growth expected at 10.8%, though revenue growth may slow to 7.2%.
Why It Stands Out
UNITED THERAPEUTICS operates in the biotechnology sector, focusing on pulmonary arterial hypertension (PAH) treatments. Its strong cash flow, high margins, and debt-free position make it a financially stable pick. The current valuation suggests the market may be underestimating its earnings potential.
For a deeper look, review the full fundamental analysis report.
Our Decent Value screener lists more stocks with attractive valuations and solid fundamentals.
Disclaimer
This is not investment advice. Always conduct your own research before making investment decisions.
