HALOZYME THERAPEUTICS, INC. (HALO) Stock Analysis
HALOZYME THERAPEUTICS, INC. (HALO) Stock Analysis
Overall Grade: F (Concerning)
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HALOZYME THERAPEUTICS, INC. faces challenges in financial performance that warrant careful analysis.
Key Metrics:
| Metric | Value | Context |
|---|---|---|
| ROIC | 31.1% | Above industry average |
| FCF Margin | 45.9% | Strong cash generation |
| Debt/Equity | 4.5x | Elevated debt |
Investment Thesis: Strong return on invested capital of 31.1% suggests durable competitive advantages and efficient capital allocation.
What is HALOZYME THERAPEUTICS, INC.'s Profitability and ROIC?
HALOZYME THERAPEUTICS, INC. generates strong returns on invested capital at 31.1%, indicating efficient capital allocation and competitive advantages. Gross margin of 84.2% with operating margin at 57.9% reflects the company's strong market position.
Key Metrics
| Metric | Value | Rating | Interpretation |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 31.1% | Excellent | Strong capital efficiency |
| Return on Equity (ROE) | 138.5% | Excellent | Efficient use of shareholder equity |
| Gross Margin | 84.2% | Excellent | Strong pricing power |
| Operating Margin | 57.9% | Excellent | Efficient operations |
How Strong is HALOZYME THERAPEUTICS, INC.'s Cash Flow Quality?
HALOZYME THERAPEUTICS, INC. generated $540.7M in free cash flow over the trailing twelve months, representing a 45.9% margin. FCF was positive in N/A of the last 8 quarters, indicating variable cash generation.
Key Metrics
| Metric | Value | Rating | Interpretation |
|---|---|---|---|
| Free Cash Flow Margin | 45.9% | Excellent | Excellent cash conversion |
| Free Cash Flow (TTM) | $540.7M | Good | Positive cash generation |
| OCF/Net Income | 1.0x | Good | Potential accrual concerns |
| FCF Consistency (8Q) | N/A | Warning | Variable cash flow |
What is HALOZYME THERAPEUTICS, INC.'s Financial Health?
HALOZYME THERAPEUTICS, INC.'s debt-to-equity ratio of 4.5x indicates elevated leverage.
Key Metrics
| Metric | Value | Rating | Interpretation |
|---|---|---|---|
| Debt to Equity | 4.5x | Red flag | Elevated leverage |
| Net Cash Position | $-1.4B | Warning | Net debt position |
Is HALOZYME THERAPEUTICS, INC. Stock Overvalued or Undervalued?
HALOZYME THERAPEUTICS, INC. trades at a P/E of 11.6x, representing a premium to the sector median of N/A.
Key Metrics
| Metric | Value | Rating | Interpretation |
|---|---|---|---|
| P/E Ratio | 11.6x | Adequate | Reasonable valuation |
| EV/Sales | 7.0x | Adequate | Growth premium priced in |
Sector Rankings
| Metric | Value | Percentile | vs Median |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 31.1% | Top 25% | - |
| Free Cash Flow Margin | 45.9% | Top 5% | - |
| Gross Margin | 84.2% | Top 25% | 1.4x above |
| Operating Margin | 57.9% | Top 5% | 12.9x above |
| Return on Equity (ROE) | 138.5% | Top 5% | - |
| P/E Ratio | 11.6x | N/A | - |
Rating Thresholds
Return on Invested Capital (ROIC)
Measures how efficiently a company uses its debt and equity capital to generate profits. ROIC above 15% typically indicates a competitive moat.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | > 20% | Exceptional capital efficiency, strong competitive moat |
| Good | 12% - 20% | Above-average returns, sustainable competitive position |
| Adequate | 8% - 12% | Around cost of capital, moderate competitive position |
| Warning | 4% - 8% | Below cost of capital, value may be eroding |
| Red flag | < 4% | Significant capital destruction, fundamental issues |
Current: 31.1% (Excellent - Top 25% of sector (median: 0.0%))
Free Cash Flow Margin
The percentage of revenue converted to free cash flow. Higher margins indicate stronger cash generation and business quality.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | > 20% | Strong cash generation, high-quality business |
| Good | 10% - 20% | Healthy cash conversion |
| Adequate | 5% - 10% | Moderate cash generation |
| Warning | 0% - 5% | Thin cash margins, capital intensive |
| Red flag | < 0% | Cash burn, potential liquidity concerns |
Current: 45.9% (Excellent - Top 5% of sector (median: 0.0%))
Gross Margin
Revenue minus cost of goods sold as a percentage. Higher gross margins indicate pricing power and competitive advantage.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | > 50% | Strong pricing power and competitive moat |
| Good | 30% - 50% | Healthy margins, differentiated product |
| Adequate | 20% - 30% | Moderate margins, competitive industry |
| Warning | 10% - 20% | Thin margins, commodity-like business |
| Red flag | < 10% | Very thin margins, structural challenges |
Current: 84.2% (Excellent - Top 25% of sector (median: 61.4%))
Debt to Equity Ratio
Total debt divided by shareholders' equity. Lower ratios indicate more conservative financing and reduced financial risk.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | < 0.3x | Conservative leverage, strong balance sheet |
| Good | 0.3x - 0.7x | Moderate leverage, healthy financial position |
| Adequate | 0.7x - 1.5x | Elevated leverage, monitor closely |
| Warning | 1.5x - 3.0x | High leverage, increased financial risk |
| Red flag | > 3.0x | Excessive leverage, potential distress risk |
Current: 453.5% (Red flag)
P/E Ratio (Price-to-Earnings)
Stock price divided by earnings per share. Lower P/E may indicate undervaluation, while higher P/E suggests growth expectations.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | < 15x | Attractively valued, potential opportunity |
| Good | 15x - 25x | Fair value for quality company |
| Adequate | 25x - 35x | Growth premium, justify with earnings growth |
| Warning | 35x - 50x | High expectations priced in |
| Red flag | > 50x or negative | Speculative valuation or losses |
Current: 11.6x (Adequate)
Frequently Asked Questions
Q: What is HALOZYME THERAPEUTICS, INC.'s Return on Invested Capital (ROIC)?
HALOZYME THERAPEUTICS, INC. (HALO) has a trailing twelve-month Return on Invested Capital (ROIC) of 31.1%. This compares above the sector median of 0.0%. An ROIC above 20% indicates exceptional capital efficiency and strong competitive advantages.
Q: What is HALOZYME THERAPEUTICS, INC.'s Free Cash Flow Margin?
HALOZYME THERAPEUTICS, INC. (HALO) has a free cash flow margin of 45.9%, generating $540.7 million in free cash flow over the trailing twelve months. A FCF margin above 20% indicates excellent cash conversion and a high-quality business model.
Q: Is HALOZYME THERAPEUTICS, INC. stock overvalued or undervalued?
HALOZYME THERAPEUTICS, INC. (HALO) trades at a P/E ratio of 11.6x, which is above the sector median of N/A. The EV/Sales multiple is 7.0x.
Q: How much debt does HALOZYME THERAPEUTICS, INC. have?
HALOZYME THERAPEUTICS, INC. (HALO) has a debt-to-equity ratio of 4.5x with total debt of $1.5 billion. Net debt position is $1.4 billion.
Q: Is HALOZYME THERAPEUTICS, INC. buying back stock?
HALOZYME THERAPEUTICS, INC. (HALO) repurchased $250.0 million of stock over the trailing twelve months.
Q: How does HALOZYME THERAPEUTICS, INC. compare to competitors in Healthcare?
Compared to other companies in Healthcare, HALOZYME THERAPEUTICS, INC. (HALO) shows: ROIC of 31.1% is above the sector median of 0.0% (Top 11%). FCF margin of 45.9% exceeds the sector median of 0.0% (Top 0% of sector). Gross margin at 84.2% is 22.8 percentage points higher than sector peers. These rankings are based on MetricDuck's analysis of all Healthcare companies with available SEC filings.
Q: What warning signs should I watch for with HALOZYME THERAPEUTICS, INC.?
Investors in HALOZYME THERAPEUTICS, INC. (HALO) should monitor these potential warning signs: 1) Debt-to-equity of 4.5x is elevated. Regular monitoring of SEC filings and quarterly trends is recommended.
Data Source: Data sourced from 10-Q filed 2025-11-03. TTM metrics as of Q2 2025.
Methodology: Financial metrics calculated from SEC 10-K and 10-Q filings using standardized formulas. Sector comparisons use peer group based on SIC code.
This analysis is for informational purposes only and does not constitute investment advice.