Stock Analysis: Affordable Growth

Fundamental Rating

Taking everything into account, HALO scores 8 out of 10 in our fundamental rating. HALO was compared to 563 industry peers in the Biotechnology industry. HALO has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. HALO is growing strongly while it also seems undervalued. This is an interesting combination This makes HALO very considerable for value and growth and quality investing!

1. Profitability

1.1 Basic Checks

HALO had positive earnings in the past year.

HALO had a positive operating cash flow in the past year.

HALO had positive earnings in each of the past 5 years.

In the past 5 years HALO always reported a positive cash flow from operatings.

1.2 Ratios

Looking at the Return On Assets, with a value of 21.52%, HALO belongs to the top of the industry, outperforming 98.93% of the companies in the same industry.

HALO has a Return On Equity of 122.06%. This is amongst the best in the industry. HALO outperforms 99.47% of its industry peers.

HALO's Return On Invested Capital of 23.00% is amongst the best of the industry. HALO outperforms 99.11% of its industry peers.

HALO had an Average Return On Invested Capital over the past 3 years of 17.81%. This is above the industry average of 14.23%.

The last Return On Invested Capital (23.00%) for HALO is above the 3 year average (17.81%), which is a sign of increasing profitability.

		Industry Rank	Sector Rank
ROA	21.52%
ROE	122.06%
ROIC	23%

ROA(3y)16.25%

ROA(5y)21.49%

ROE(3y)192.36%

ROE(5y)173.4%

ROIC(3y)17.81%

ROIC(5y)29.79%

1.3 Margins

HALO has a better Profit Margin (43.74%) than 98.93% of its industry peers.

In the last couple of years the Profit Margin of HALO has declined.

The Operating Margin of HALO (54.32%) is better than 99.82% of its industry peers.

HALO's Operating Margin has declined in the last couple of years.

HALO has a better Gross Margin (84.30%) than 86.68% of its industry peers.

HALO's Gross Margin has improved in the last couple of years.

		Industry Rank	Sector Rank
OM	54.32%
PM (TTM)	43.74%
GM	84.3%

OM growth 3Y-4.44%

OM growth 5YN/A

PM growth 3Y-21.62%

PM growth 5YN/A

GM growth 3Y1.07%

GM growth 5Y1.9%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so HALO is creating value.

The number of shares outstanding for HALO has been reduced compared to 1 year ago.

Compared to 5 years ago, HALO has less shares outstanding

The debt/assets ratio for HALO has been reduced compared to a year ago.

2.2 Solvency

An Altman-Z score of 5.23 indicates that HALO is not in any danger for bankruptcy at the moment.

HALO has a Altman-Z score of 5.23. This is amongst the best in the industry. HALO outperforms 81.53% of its industry peers.

The Debt to FCF ratio of HALO is 3.21, which is a good value as it means it would take HALO, 3.21 years of fcf income to pay off all of its debts.

HALO has a Debt to FCF ratio of 3.21. This is amongst the best in the industry. HALO outperforms 93.96% of its industry peers.

A Debt/Equity ratio of 4.14 is on the high side and indicates that HALO has dependencies on debt financing.

HALO's Debt to Equity ratio of 4.14 is on the low side compared to the rest of the industry. HALO is outperformed by 83.66% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	4.14
Debt/FCF	3.21
Altman-Z	5.23

ROIC/WACC2.49

WACC9.25%

2.3 Liquidity

A Current Ratio of 7.80 indicates that HALO has no problem at all paying its short term obligations.

HALO has a Current ratio of 7.80. This is in the better half of the industry: HALO outperforms 73.36% of its industry peers.

A Quick Ratio of 6.78 indicates that HALO has no problem at all paying its short term obligations.

Looking at the Quick ratio, with a value of 6.78, HALO is in the better half of the industry, outperforming 68.03% of the companies in the same industry.

		Industry Rank	Sector Rank
Current Ratio	7.8
Quick Ratio	6.78

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

HALO shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 46.77%, which is quite impressive.

The Earnings Per Share has been growing by 30.12% on average over the past years. This is a very strong growth

Looking at the last year, HALO shows a very strong growth in Revenue. The Revenue has grown by 22.44%.

HALO shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 38.95% yearly.

EPS 1Y (TTM)46.77%

EPS 3Y30.12%

EPS 5YN/A

EPS Q2Q%40.51%

Revenue 1Y (TTM)22.44%

Revenue growth 3Y31.82%

Revenue growth 5Y38.95%

Sales Q2Q%35.22%

3.2 Future

Based on estimates for the next years, HALO will show a quite strong growth in Earnings Per Share. The EPS will grow by 16.06% on average per year.

Based on estimates for the next years, HALO will show a quite strong growth in Revenue. The Revenue will grow by 11.27% on average per year.

EPS Next Y24.79%

EPS Next 2Y26.9%

EPS Next 3Y24.66%

EPS Next 5Y16.06%

Revenue Next Year19.16%

Revenue Next 2Y21.65%

Revenue Next 3Y19.98%

Revenue Next 5Y11.27%

3.3 Evolution

Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.

The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.

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4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 14.89, which indicates a correct valuation of HALO.

96.09% of the companies in the same industry are more expensive than HALO, based on the Price/Earnings ratio.

HALO is valuated rather cheaply when we compare the Price/Earnings ratio to 24.12, which is the current average of the S&P500 Index.

A Price/Forward Earnings ratio of 9.94 indicates a reasonable valuation of HALO.

96.80% of the companies in the same industry are more expensive than HALO, based on the Price/Forward Earnings ratio.

HALO is valuated cheaply when we compare the Price/Forward Earnings ratio to 20.42, which is the current average of the S&P500 Index.

		Industry Rank	Sector Rank
PE	14.89
Fwd PE	9.94

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, HALO is valued cheaply inside the industry as 95.74% of the companies are valued more expensively.

Based on the Price/Free Cash Flow ratio, HALO is valued cheaper than 95.56% of the companies in the same industry.