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 588 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 is evaluated to be cheap and growing strongly. This does not happen too often! This makes HALO very considerable 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.
HALO had a positive operating cash flow in 4 of the past 5 years.

1.2 Ratios

Looking at the Return On Assets, with a value of 16.25%, HALO belongs to the top of the industry, outperforming 98.98% of the companies in the same industry.
HALO has a Return On Equity of 335.99%. This is amongst the best in the industry. HALO outperforms 100.00% of its industry peers.
Looking at the Return On Invested Capital, with a value of 17.00%, HALO belongs to the top of the industry, outperforming 98.46% of the companies in the same industry.
HALO had an Average Return On Invested Capital over the past 3 years of 17.78%. This is above the industry average of 13.85%.
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

HALO has a Profit Margin of 33.96%. This is amongst the best in the industry. HALO outperforms 99.15% of its industry peers.
In the last couple of years the Profit Margin of HALO has declined.
HALO's Operating Margin of 41.02% 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 76.82% is amongst the best of the industry. HALO outperforms 86.35% 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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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.
HALO has less shares outstanding than it did 1 year ago.
The number of shares outstanding for HALO has been reduced compared to 5 years ago.
HALO has a worse debt/assets ratio than last year.

2.2 Solvency

HALO has an Altman-Z score of 3.40. This indicates that HALO is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 3.40, HALO is in the better half of the industry, outperforming 75.77% of the companies in the same industry.
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.
HALO has a better Debt to FCF ratio (4.02) than 95.05% of its industry peers.
HALO has a Debt/Equity ratio of 17.89. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 17.89, HALO is doing worse than 84.98% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 17.89
Debt/FCF 4.02
Altman-Z 3.4
ROIC/WACC2.35
WACC7.22%

2.3 Liquidity

HALO has a Current Ratio of 6.64. This indicates that HALO is financially healthy and has no problem in meeting its short term obligations.
HALO has a Current ratio of 6.64. This is in the better half of the industry: HALO outperforms 66.55% of its industry peers.
HALO has a Quick Ratio of 5.50. This indicates that HALO is financially healthy and has no problem in meeting its short term obligations.
The Quick ratio of HALO (5.50) is comparable to the rest of the industry.
Industry RankSector Rank
Current Ratio 6.64
Quick Ratio 5.5

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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 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
HALO shows a strong growth in Revenue. In the last year, the Revenue has grown by 25.59%.
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 Y35.27%
EPS Next 2Y29.38%
EPS Next 3Y30.48%
EPS Next 5Y20.73%
Revenue Next Year14.89%
Revenue Next 2Y14.25%
Revenue Next 3Y16.45%
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.
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 13.71 indicates a correct valuation of HALO.
Compared to the rest of the industry, the Price/Earnings ratio of HALO indicates a rather cheap valuation: HALO is cheaper than 97.95% of the companies listed in the same industry.
HALO is valuated rather cheaply when we compare the Price/Earnings ratio to 24.67, which is the current average of the S&P500 Index.
HALO is valuated reasonably with a Price/Forward Earnings ratio of 10.13.
98.63% of the companies in the same industry are more expensive than HALO, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 21.02. HALO is valued rather cheaply when compared to this.
Industry RankSector Rank
PE 13.71
Fwd PE 10.13

4.2 Price Multiples

96.93% of the companies in the same industry are more expensive than HALO, based on the Enterprise Value to EBITDA ratio.
98.29% of the companies in the same industry are more expensive than HALO, based on the Price/Free Cash Flow ratio.
Industry RankSector Rank
P/FCF 12.97
EV/EBITDA 13.61

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.
The decent profitability rating of HALO may justify a higher PE ratio.
HALO's earnings are expected to grow with 30.48% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.39
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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