Affordable Growth. Analyze the stocks which are showing good growth, decent profitability and health and are not overvalued from a fundamental perspective.


HALOZYME THERAPEUTICS INC

Nasdaq / Health Care / Biotechnology

Fundamental Rating

7

Taking everything into account, HALO scores 7 out of 10 in our fundamental rating. HALO was compared to 587 industry peers in the Biotechnology industry. HALO scores excellent points on both the profitability and health parts. This is a solid base for a good stock. HALO is evaluated to be cheap and growing strongly. This does not happen too often! These ratings would make HALO suitable for value and growth and quality investing!



7

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.
Of the past 5 years HALO 4 years were profitable.
Of the past 5 years HALO 4 years had a positive operating cash flow.

1.2 Ratios

Looking at the Return On Assets, with a value of 17.31%, HALO belongs to the top of the industry, outperforming 98.80% of the companies in the same industry.
With an excellent Return On Equity value of 179.30%, HALO belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
HALO has a better Return On Invested Capital (18.09%) than 98.80% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for HALO is above the industry average of 14.45%.
The last Return On Invested Capital (18.09%) for HALO is above the 3 year average (17.78%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 17.31%
ROE 179.3%
ROIC 18.09%
ROA(3y)21.23%
ROA(5y)14.64%
ROE(3y)219.81%
ROE(5y)133.26%
ROIC(3y)17.78%
ROIC(5y)N/A

1.3 Margins

With an excellent Profit Margin value of 36.95%, HALO belongs to the best of the industry, outperforming 99.49% of the companies in the same industry.
HALO's Profit Margin has declined in the last couple of years.
HALO's Operating Margin of 44.25% is amongst the best of the industry. HALO outperforms 99.49% of its industry peers.
In the last couple of years the Operating Margin of HALO has declined.
HALO's Gross Margin of 78.51% is amongst the best of the industry. HALO outperforms 86.84% of its industry peers.
HALO's Gross Margin has declined in the last couple of years.
Industry RankSector Rank
OM 44.25%
PM (TTM) 36.95%
GM 78.51%
OM growth 3Y-8.72%
OM growth 5YN/A
PM growth 3Y-11.05%
PM growth 5YN/A
GM growth 3Y-2.86%
GM growth 5Y-3.81%

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7

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.
Compared to 1 year ago, HALO has less shares outstanding
Compared to 5 years ago, HALO has less shares outstanding
Compared to 1 year ago, HALO has a worse debt to assets ratio.

2.2 Solvency

HALO has an Altman-Z score of 3.84. This indicates that HALO is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of HALO (3.84) is better than 75.04% of its industry peers.
The Debt to FCF ratio of HALO is 3.54, which is a good value as it means it would take HALO, 3.54 years of fcf income to pay off all of its debts.
With an excellent Debt to FCF ratio value of 3.54, HALO belongs to the best of the industry, outperforming 95.90% of the companies in the same industry.
HALO has a Debt/Equity ratio of 8.44. This is a high value indicating a heavy dependency on external financing.
With a Debt to Equity ratio value of 8.44, HALO is not doing good in the industry: 84.44% of the companies in the same industry are doing better.
Industry RankSector Rank
Debt/Equity 8.44
Debt/FCF 3.54
Altman-Z 3.84
ROIC/WACC2.49
WACC7.27%

2.3 Liquidity

A Current Ratio of 6.64 indicates that HALO has no problem at all paying its short term obligations.
Looking at the Current ratio, with a value of 6.64, HALO is in the better half of the industry, outperforming 65.47% of the companies in the same industry.
A Quick Ratio of 5.36 indicates that HALO has no problem at all paying its short term obligations.
HALO's Quick ratio of 5.36 is in line compared to the rest of the industry. HALO outperforms 57.44% of its industry peers.
Industry RankSector Rank
Current Ratio 6.64
Quick Ratio 5.36

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9

3. Growth

3.1 Past

HALO shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 39.64%, which is quite impressive.
HALO shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 45.64% yearly.
HALO shows a strong growth in Revenue. In the last year, the Revenue has grown by 22.40%.
HALO shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 40.42% yearly.
EPS 1Y (TTM)39.64%
EPS 3Y45.64%
EPS 5YN/A
EPS growth Q2Q68.09%
Revenue 1Y (TTM)22.4%
Revenue growth 3Y45.79%
Revenue growth 5Y40.42%
Revenue growth Q2Q20.84%

3.2 Future

HALO is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 22.93% yearly.
The Revenue is expected to grow by 13.80% on average over the next years. This is quite good.
EPS Next Y35.27%
EPS Next 2Y29.38%
EPS Next 3Y30.48%
EPS Next 5Y22.93%
Revenue Next Year14.89%
Revenue Next 2Y14.25%
Revenue Next 3Y16.45%
Revenue Next 5Y13.8%

3.3 Evolution

The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in 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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9

4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 14.64 indicates a correct valuation of HALO.
HALO's Price/Earnings ratio is rather cheap when compared to the industry. HALO is cheaper than 97.44% of the companies in the same industry.
HALO's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.83.
A Price/Forward Earnings ratio of 9.75 indicates a reasonable valuation of HALO.
HALO's Price/Forward Earnings ratio is rather cheap when compared to the industry. HALO is cheaper than 98.29% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 20.47, HALO is valued rather cheaply.
Industry RankSector Rank
PE 14.64
Fwd PE 9.75

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, HALO is valued cheaply inside the industry as 96.58% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, HALO is valued cheaply inside the industry as 98.46% of the companies are valued more expensively.
Industry RankSector Rank
P/FCF 13.62
EV/EBITDA 13.94

4.3 Compensation for Growth

The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
HALO has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as HALO's earnings are expected to grow with 30.48% in the coming years.
PEG (NY)0.42
PEG (5Y)N/A
EPS Next 2Y29.38%
EPS Next 3Y30.48%

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0

5. Dividend

5.1 Amount

No dividends for HALO!.
Industry RankSector Rank
Dividend Yield N/A

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