Investors seeking growth at a reasonable cost should explore VERACYTE INC (NASDAQ:VCYT).

Consider VERACYTE INC (NASDAQ:VCYT) as an affordable growth stock, identified by our stock screening tool. VCYT is showcasing impressive growth figures and is well-positioned in terms of profitability, solvency, and liquidity. Moreover, it seems to be priced reasonably. Let's dive deeper into the analysis.

Analyzing Growth Metrics

ChartMill assigns a Growth Rating to every stock. This score ranges from 0 to 10 and evaluates the different growth aspects like EPS and Revenue, both in the past as in the future. VCYT scores a 7 out of 10:

• VCYT shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 129.13%, which is quite impressive.
• Looking at the last year, VCYT shows a very strong growth in Revenue. The Revenue has grown by 23.46%.
• The Revenue has been growing by 29.93% on average over the past years. This is a very strong growth!
• VCYT is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 48.44% yearly.
• Based on estimates for the next years, VCYT will show a quite strong growth in Revenue. The Revenue will grow by 8.53% on average per year.

Understanding VCYT's Valuation

ChartMill assigns a proprietary Valuation Rating to each stock. The score is computed by evaluating various valuation aspects, like price to earnings and free cash flow, both absolutely as relative to the market and industry. VCYT was assigned a score of 6 for valuation:

• Based on the Price/Earnings ratio, VCYT is valued cheaper than 92.40% of the companies in the same industry.
• 91.52% of the companies in the same industry are more expensive than VCYT, based on the Price/Forward Earnings ratio.
• Based on the Enterprise Value to EBITDA ratio, VCYT is valued cheaper than 93.29% of the companies in the same industry.
• Based on the Price/Free Cash Flow ratio, VCYT is valued cheaper than 94.35% of the companies in the same industry.
• VCYT's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• The decent profitability rating of VCYT may justify a higher PE ratio.
• VCYT's earnings are expected to grow with 52.96% in the coming years. This may justify a more expensive valuation.

Looking at the Health

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. VCYT has received a 7 out of 10:

• VCYT has an Altman-Z score of 11.38. This indicates that VCYT is financially healthy and has little risk of bankruptcy at the moment.
• The Altman-Z score of VCYT (11.38) is better than 89.22% of its industry peers.
• VCYT has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
• VCYT has a Current Ratio of 4.73. This indicates that VCYT is financially healthy and has no problem in meeting its short term obligations.
• VCYT has a Quick Ratio of 4.46. This indicates that VCYT is financially healthy and has no problem in meeting its short term obligations.

Evaluating Profitability: VCYT

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, VCYT has achieved a 6:

• VCYT has a Return On Assets of 1.86%. This is amongst the best in the industry. VCYT outperforms 91.87% of its industry peers.
• The Return On Equity of VCYT (2.05%) is better than 92.23% of its industry peers.
• With an excellent Return On Invested Capital value of 1.26%, VCYT belongs to the best of the industry, outperforming 92.58% of the companies in the same industry.
• Looking at the Profit Margin, with a value of 5.41%, VCYT belongs to the top of the industry, outperforming 92.58% of the companies in the same industry.
• The Operating Margin of VCYT (4.38%) is better than 92.93% of its industry peers.
• VCYT's Gross Margin of 67.54% is amongst the best of the industry. VCYT outperforms 80.04% of its industry peers.

Every day, new Affordable Growth stocks can be found on ChartMill in our Affordable Growth screener.

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

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.