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 592 industry peers in the Biotechnology industry. Both the health and profitability get an excellent rating, making HALO a very profitable company, without any liquidiy or solvency issues. HALO has both an excellent growth and valuation score. This means it is growing and it is still cheap. This is a rare combination! This makes HALO very considerable for value and growth and quality investing!



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1. Profitability

1.1 Basic Checks

HALO had positive earnings in the past year.
In the past year HALO had a positive cash flow from operations.
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

HALO has a Return On Assets of 16.25%. This is amongst the best in the industry. HALO outperforms 98.98% of its industry peers.
Looking at the Return On Equity, with a value of 335.99%, HALO belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
HALO has a Return On Invested Capital of 17.00%. This is amongst the best in the industry. HALO outperforms 98.47% of its industry peers.
HALO had an Average Return On Invested Capital over the past 3 years of 17.78%. This is above the industry average of 13.58%.
Industry RankSector Rank
ROA 16.25%
ROE 335.99%
ROIC 17%
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

Looking at the Profit Margin, with a value of 33.96%, HALO belongs to the top of the industry, outperforming 99.15% of the companies in the same industry.
In the last couple of years the Profit Margin of HALO has declined.
Looking at the Operating Margin, with a value of 41.02%, HALO belongs to the top of the industry, outperforming 99.32% of the companies in the same industry.
In the last couple of years the Operating Margin of HALO has declined.
HALO's Gross Margin of 76.82% is amongst the best of the industry. HALO outperforms 86.05% of its industry peers.
In the last couple of years the Gross Margin of HALO has declined.
Industry RankSector Rank
OM 41.02%
PM (TTM) 33.96%
GM 76.82%
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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2. Health

2.1 Basic Checks

HALO has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it 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
HALO has a worse debt/assets ratio than last year.

2.2 Solvency

HALO has an Altman-Z score of 3.52. This indicates that HALO is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of HALO (3.52) is better than 73.64% of its industry peers.
The Debt to FCF ratio of HALO is 4.02, which is a neutral value as it means it would take HALO, 4.02 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 4.02, HALO belongs to the top of the industry, outperforming 95.07% of the companies in the same industry.
HALO has a Debt/Equity ratio of 17.89. This is a high value indicating a heavy dependency on external financing.
HALO's Debt to Equity ratio of 17.89 is on the low side compared to the rest of the industry. HALO is outperformed by 86.90% of its industry peers.
Industry RankSector Rank
Debt/Equity 17.89
Debt/FCF 4.02
Altman-Z 3.52
ROIC/WACC2.13
WACC8%

2.3 Liquidity

A Current Ratio of 6.64 indicates that HALO has no problem at all paying its short term obligations.
With a decent Current ratio value of 6.64, HALO is doing good in the industry, outperforming 63.78% of the companies in the same industry.
A Quick Ratio of 5.50 indicates that HALO has no problem at all paying its short term obligations.
HALO has a Quick ratio (5.50) which is in line with its industry peers.
Industry RankSector Rank
Current Ratio 6.64
Quick Ratio 5.5

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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 25.23%, which is quite impressive.
The Earnings Per Share has been growing by 45.64% on average over the past years. This is a very strong growth
The Revenue has grown by 25.59% in the past year. This is a very strong growth!
HALO shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 40.42% yearly.
EPS 1Y (TTM)25.23%
EPS 3Y45.64%
EPS 5YN/A
EPS growth Q2Q70.83%
Revenue 1Y (TTM)25.59%
Revenue growth 3Y45.79%
Revenue growth 5Y40.42%
Revenue growth Q2Q26.74%

3.2 Future

HALO is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 20.73% yearly.
Based on estimates for the next years, HALO will show a quite strong growth in Revenue. The Revenue will grow by 11.91% on average per year.
EPS Next Y35.2%
EPS Next 2Y29.58%
EPS Next 3Y30.61%
EPS Next 5Y20.73%
Revenue Next Year14.92%
Revenue Next 2Y14.36%
Revenue Next 3Y16.54%
Revenue Next 5Y11.91%

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

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4. Valuation

4.1 Price/Earnings Ratio

HALO is valuated correctly with a Price/Earnings ratio of 14.65.
Based on the Price/Earnings ratio, HALO is valued cheaply inside the industry as 97.79% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 26.42, HALO is valued a bit cheaper.
Based on the Price/Forward Earnings ratio of 10.84, the valuation of HALO can be described as reasonable.
HALO's Price/Forward Earnings ratio is rather cheap when compared to the industry. HALO is cheaper than 98.47% of the companies in the same industry.
HALO's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.74.
Industry RankSector Rank
PE 14.65
Fwd PE 10.84

4.2 Price Multiples

96.60% of the companies in the same industry are more expensive than HALO, based on the Enterprise Value to EBITDA ratio.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of HALO indicates a rather cheap valuation: HALO is cheaper than 98.30% of the companies listed in the same industry.
Industry RankSector Rank
P/FCF 13.84
EV/EBITDA 14.38

4.3 Compensation for Growth

HALO's 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.
HALO's earnings are expected to grow with 30.61% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.42
PEG (5Y)N/A
EPS Next 2Y29.58%
EPS Next 3Y30.61%

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5. Dividend

5.1 Amount

HALO does not give a dividend.
Industry RankSector Rank
Dividend Yield N/A