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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Neurocrine Biosciences, Inc. (XNAS:NBIX) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
NBIX
Name:
NEUROCRINE BIOSCIENCES, INC. (XNAS:NBIX)
Sector:
- 48100.00K
Industry:
Drug Manufacturers�Specialty & Generic
CEO:
Dr. Kevin Gorman
Total Employees:
900
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -12514.92% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF NEUROCRINE BIOSCIENCES, INC.(NBIX) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND DRUG MANUFACTURERS�SPECIALTY & GENERIC INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
103.01
One Month Price Target:
$103.32
Six Month Price Target :
$104.89
Likely Price in One Year's Time:
Ticker:
$106.77
Likely Trading Range Today Under (Normal Volatility)
$102.58
Price Upper limit ($) :
$103.48
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$97.58
This week:
$90.88
This month :
$78.75
Other Primary facts
Market Cap:
9.85B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
95.64M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
13.%
-14.81%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$128.20
$116.70
$77.82
$89.32
Medium risk (<10%) entry points
Buy Call
Sell Call
$112.96
Buy Put:
Sell Put:
$110.51
$93.03
$95.51
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
NBIX
Sharpe Ratio:
0.41%
Comparison:
NBIX, is amongst the top 60% stocks with highest risk-adjusted returns
Sharpe ratio is -55.08% lower than the industry
& is -82.04% lower than the market/S&P 500 average
Average Returns/Yield of
NBIX
Daily returns:
0.02%
Weekly returns:
0.10%
Monthly returns:
0.39%
Yearly returns:
14.20%
Comparison of returns:
Average annual returns/yield (last 3 years) is -67.24% below industry average
Classification:
NBIX, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.71
Statistical test of Returns:
NBIX has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.57%
Weekly Volatility:
5.76%
Monthly Volatility:
11.51%
Yearly Volatility:
39.88%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.94%
Volatility in last five trading days has been -24.80% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.27%
Weekly VaR:
-11.78%
Monthly VaR:
-23.56%
How Much Can the price of
NBIX
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-21%
Worst case (decline):
-81.60%
This translates to price declining to:
$81.78
This translates to price declining to:
$18.96
Severe Crash Probability
Risk of crash in next 6/12 months: Medium (<50%)
What is Value at Risk (VaR)?
Risk Fundamentals
NBIX is a 66.25% riskier investment compared to the market/S&P 500 & is 42.43% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -31.54% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
NBIX
Beta in relation to market/S&P 500--0.54
Expected beta in 1 year's time:
0.506
Expected beta in 3 year's time:
0.716
Unlevered (debt free) Beta:
0.432
Beta in relation to Nasdaq (XNAS):
0.634
Beta in relation to all global stocks::
0.581
Beta Comparison & Analysis
Beta of competitors/peers::
1.022
Beta is -46.78% lower than peers
Average Industry Beta:
1.054
Beta is -48.41% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
6.84%
Sustainable growth rate is -78.79% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
-0.022
Alpha is -157.98% below industry average alpha yield
Alpha is -141% below the market average
Analysis of Cost of Capital of
NBIX
Equity cost of capital:
0.069
Equity cost of capital is -33.70% below industry mean WACC
Unlevered (without debt) cost of capital:
5.47%
Before-tax cost of debt:
4.58%
After-tax cost of debt:
3.62%
Overall debt rating:
Lower BB medium grade (Fifth highest grade)
Weighted average cost of capital (WACC):
3.62%
WACC is -19.43% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$12.63
Revenue growth rate per share of (3Y):
7.08
Annual revenue growth rate is -30.06% below industry average
EPS:
$0.73
Expected Annual growth rate of EPS (3Y):
32.00%
Expected future EPS growth rate is 36.38% higher than the Drug Manufacturers�Specialty & Generic industry
Free cash flow (FCF) per share:
$1.05
-
-
Debt per share
$5.02
EBITDA per share
$1.35
Valuation Analysis Today of
NBIX
P/E Ratio:
865.48
P/E Ratio of Competitors/Peers:
60.92
P/E ratio is 1320.75% higher than main peers & is 2065.80% higher than the industry
Stock price/value with industry average P/E ratio: $29.17
NBIX is 253.12% overvalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
8.16
Price to sales ratio is 15.25% above the industry mean
P/B (Price to book value ratio):
7.08
Price to free cash flow: 97.80
-
Net income growth rate (3Y):
304.41%
Net income growth rate is -155.56% lower than the industry average net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
34.52%
Net debt to equity ratio:
15.10%
Debt to assets ratio:
22.39%
Net debt to assets ratio:
9.79%
Debt-to-asset ratio is -56.55% below industry average
Ability to repay debt:
Interest coverage ratio:
5.88
Interest coverage ratio is -15.43% less than industry average
Looking forward:
Debt growth rate:
6.82%
Annual debt growth is 3% higher than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.427
Statistical significance of correlation:
NBIX has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.408
Stock price is 4.49% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.408
Correlation of price movement with Nasdaq (^IXIC):
-0.007
Covariance of price movement with the market:
-0.011
Kurtosis
4.076
Returns have moderate fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.056
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
NBIX
Gross Profit Margin Ratio:
395%
Operating Profit Margin Ratio:
6.14%
Operating profit margin is -118.25% lower than the industry
Net Profit Margin Ratio:
395%
Effective Tax Rate:
25.31%
Effective tax rate is 94.42% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
5.13%
Return on equity (ROE) is -151.60% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
3.33%
Return on assets (ROA) is -189.23% lower than the industry
Financial Leverage:
1.3x
Current Ratio:
4.02
Current ratio is 21.91% above industry average
Cash Conversion Cycle (days):
252.5
Cash conversion cycle is 66.86% above industry average
The remaining useful life of property plant & equipment is: 10.7 years
Stock based compensation to net income ratio:
51.82%
In-depth Efficiency Analysis
Revenue generated per employee:
1.3M
Each employee generates 60% more revenue than industry average revenue per employee
EBITDA generated per employee:
143.7K
Each employee generates 52% more EBITDA than industry average revenue per employee
Profit generated per employee:
79.3K
Each employee generates -23% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 53.4K
Each employee generates -7% less free cash flow than industry average revenue per employee
Assets/Capital per employee
1.3M
Each employee generates -7% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- 19.31%
Growth rate in R&D investment/expenditure is 194.16% higher than the industry
Competitors/Peer firms of
NBIX
OMNICELL, INC. (XNAS:OMCL)
NATERA, INC. (XNAS:NTRA)
MIRATI THERAPEUTICS, INC. (XNAS:MRTX)
SAREPTA THERAPEUTICS, INC. (XNAS:SRPT)
Legend Biotech Corporation (XNAS:LEGN)
MEDPACE HOLDINGS, INC. (XNAS:MEDP)
Ascendis Pharma A/S (XNAS:ASND)
CHANGE HEALTHCARE INC. (XNAS:CHNG)
R1 RCM HOLDCO INC. (XNAS:RCM)
Current Analyst Ratings
Strong buy�21%
Buy�33%
Hold�0%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
1.21B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
16.00M
1.19B
357.10M
-
655.00M
-
-
1.01B
-
22.00M
11.70M
129.30M
74.10M
71.40M
95.60M
24.20M
71.40M
Statement of Cash Flow
Date:
Period:
3.30M
Differed Income Tax :
- 300.00K
Stock Based Compensation :
37.00M
Change in Working Capital :
- 75700.00K
Accounts Receivables:
- 78000.00K
Other Working Capital:
- 10700.00K
Other Non-Cash Items:
- 18700.00K
Net Cash Provided by Operating Activities:
- 40500.00K
Investments in PP&E:
- 7600.00K
Net Acquisitions:
-
Purchases of Investments:
- 200500.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
270.20M
394.70M
664.90M
263.50M
29.00M
60.80M
1.02B
158.60M
-
-
632.30M
325.30M
10.10M
1.13B
-
2.14B
-
-
-
-
253.50M
253.50M
480.20M
19.70M
499.90M
-
753.40M
100.00K
- 547400.00K
- 9300.0K
1.95B
March 31, 2022 at 6:00:00 AM
1.03B
1.39B
2.14B
1.03B
480.20M
210.0M
176.50M
-
- 31600.00K
-
-
-
-
6.10M
6.10M
-
- 66000.00K
278.00M
344.00M
- 40500.00K
- 7600.00K
- 48100.00K
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
NBIX
2023
2024
2025
2026
2027
$107.30
$300.50
$311.47
$322.85
$334.65