Neurocrine Biosciences, Inc. (NBIX) Overview
The company is engaged in the development and sale of drugs for the treatment of neurological, endocrine and mental disorders. It is profitable, there are drugs in the portfolio for 2, 3 and completed the 3rd stage of approval by the FDA.
Capitalization = $9 billion, P/E = 95, peg = 2.3. Over the past 12 months, revenue is $1.04 billion, profit is $93 million.
Since 2017, NBIX has had a positive cash flow, since the end of 2018 it has reached profitability (it was also profitable in the 90s and until 2006). There is a debt of $425 million, but it is covered by the cash available on the balance sheet and with a positive cash balance does not cause concern.
Forecasts for revenue and profit are positive: with the current EPS of ~ $1 per share, the expected results for the years are as follows:
2021 = 1.75 - 5.33 (mean 3.69)
2022 = 2.93 - 6.85 (mean 4.98)
2023 = 4.3 - 9.1 (mean 6.84)
2024 = 4.92 - 11.26 (mean 8.41).
Take the most pessimistic scenario, and according to the results of 2024, we get eps = $4.92 per share, which gives a profitability increase of 5 times over the next 4 years with a revenue growth of ~ 2 times.
There are only 2 stocks in my portfolio, the purchase price = $89. I plan to increase my portfolio to 1-2%, possibly more. Neurocrine Biosciences should not expect a multiple price increase, but the company has an underestimate at current levels + an increase in earnings per share on the horizon due to the likely approval of a new drug. My forecast for the stock price at the end of 2024 (or earlier): $235, +145% in absolute dollars or +25% per annum. It is not an investment advice.
In the attachment of the chart
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Revenue and earnings, 2020 and further - projected values
of 2? Earnings per share, 2020 and further - projected values.
Ideas
November 25, 2020