Stock Analysis: Affordable Growth

Fundamental Rating

Overall HALO gets a fundamental rating of 8 out of 10. We evaluated HALO against 560 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 has both an excellent growth and valuation score. This means it is growing and it is still cheap. This is a rare combination! These ratings could make HALO a good candidate for value and growth and quality investing.

1. Profitability

1.1 Basic Checks

In the past year HALO was profitable.

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

Each year in the past 5 years HALO has been profitable.

HALO had a positive operating cash flow in each of the past 5 years.

1.2 Ratios

With an excellent Return On Assets value of 22.10%, HALO belongs to the best of the industry, outperforming 97.86% of the companies in the same industry.

HALO has a better Return On Equity (100.64%) than 99.29% of its industry peers.

Looking at the Return On Invested Capital, with a value of 23.44%, HALO belongs to the top of the industry, outperforming 97.86% of the companies in the same industry.

HALO had an Average Return On Invested Capital over the past 3 years of 17.81%. This is above the industry average of 15.80%.

The last Return On Invested Capital (23.44%) for HALO is above the 3 year average (17.81%), which is a sign of increasing profitability.

		Industry Rank	Sector Rank
ROA	22.1%
ROE	100.64%
ROIC	23.44%

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

The Profit Margin of HALO (44.76%) is better than 98.75% of its industry peers.

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

With an excellent Operating Margin value of 55.10%, HALO belongs to the best of the industry, outperforming 99.82% of the companies in the same industry.

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

HALO has a Gross Margin of 83.45%. This is amongst the best in the industry. HALO outperforms 86.96% of its industry peers.

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

		Industry Rank	Sector Rank
OM	55.1%
PM (TTM)	44.76%
GM	83.45%

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

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

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

The number of shares outstanding for HALO has been reduced compared to 5 years ago.

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

2.2 Solvency

HALO has an Altman-Z score of 4.66. 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 4.66, HALO is in the better half of the industry, outperforming 79.82% of the companies in the same industry.

The Debt to FCF ratio of HALO is 3.04, which is a good value as it means it would take HALO, 3.04 years of fcf income to pay off all of its debts.

HALO has a Debt to FCF ratio of 3.04. This is amongst the best in the industry. HALO outperforms 94.29% of its industry peers.

A Debt/Equity ratio of 3.13 is on the high side and indicates that HALO has dependencies on debt financing.

HALO has a worse Debt to Equity ratio (3.13) than 83.57% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	3.13
Debt/FCF	3.04
Altman-Z	4.66

ROIC/WACC2.71

WACC8.65%

2.3 Liquidity

HALO has a Current Ratio of 8.39. This indicates that HALO is financially healthy and has no problem in meeting its short term obligations.

HALO has a better Current ratio (8.39) than 72.86% of its industry peers.

HALO has a Quick Ratio of 7.30. This indicates that HALO is financially healthy and has no problem in meeting its short term obligations.

HALO has a Quick ratio of 7.30. This is in the better half of the industry: HALO outperforms 68.39% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	8.39
Quick Ratio	7.3

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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.

Measured over the past years, HALO shows a very strong growth in Earnings Per Share. The EPS has been growing by 30.12% on average per year.

HALO shows a strong growth in Revenue. In the last year, the Revenue has grown by 25.66%.

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)25.66%

Revenue growth 3Y31.82%

Revenue growth 5Y38.95%

Sales Q2Q%35.22%

3.2 Future

The Earnings Per Share is expected to grow by 16.06% on average over the next years. This is quite good.

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 Y26.02%

EPS Next 2Y28.66%

EPS Next 3Y26.73%

EPS Next 5Y16.06%

Revenue Next Year24.83%

Revenue Next 2Y21.37%

Revenue Next 3Y18.42%

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

With a Price/Earnings ratio of 11.95, the valuation of HALO can be described as very reasonable.

HALO's Price/Earnings ratio is rather cheap when compared to the industry. HALO is cheaper than 96.61% of the companies in the same industry.

HALO is valuated cheaply when we compare the Price/Earnings ratio to 25.91, which is the current average of the S&P500 Index.

Based on the Price/Forward Earnings ratio of 7.76, the valuation of HALO can be described as very cheap.

HALO's Price/Forward Earnings ratio is rather cheap when compared to the industry. HALO is cheaper than 97.32% of the companies in the same industry.

HALO is valuated cheaply when we compare the Price/Forward Earnings ratio to 21.77, which is the current average of the S&P500 Index.

		Industry Rank	Sector Rank
PE	11.95
Fwd PE	7.76

4.2 Price Multiples

HALO's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. HALO is cheaper than 96.61% of the companies in the same industry.

HALO's Price/Free Cash Flow ratio is rather cheap when compared to the industry. HALO is cheaper than 96.43% of the companies in the same industry.