Thinking of Investing in NBIX? What Our Analysts Know.

Neurocrine Biosciences shares moved 10.8% over the last 52 weeks, with a high of $129.29 and a low of $75.25. During this time, the stock outperformed the S&P 500 index by 10.0%. As of January 2022, the company's 50-day average price is $100.0. Neurocrine Biosciences, Inc. discovers, develops, and markets pharmaceuticals for neurological, endocrine, and psychiatric disorders. The mid-cap Health Care company has 1,200 full time employees and is based in San Diego, CA. Neurocrine Biosciences has not offered any dividends in the last year.

Exceptional EPS Growth with Low Leverage Levels:

2019-12-31 2020-12-31 2021-12-31 2022-12-31
Revenue (MM) $788 $1,046 $1,134 $1,489
Revenue Growth n/a 32.71% 8.38% 31.34%
Operating Margins 28.8% 31.3% 18.3% 16.7%
Operating Margins Growth n/a 8.68% -41.53% -8.74%
Earnings Per Share $0.39 $4.16 $0.92 $1.56
EPS Growth n/a 966.67% -77.88% 69.57%
Diluted Shares (MM) 96 98 98 98
Free Cash Flow (MM) $137 $218 $233 $323
FCF Growth n/a 58.48% 7.12% 38.52%
Capital Expenditures (MM) -$15 -$11 -$23 -$16
Net Debt / EBITDA nan nan nan nan

Neurocrine Biosciences Is Fairly Valued:

Compared to the Health Care sector's average of 24.45, Neurocrine Biosciences has a trailing twelve month P/E ratio of 64.8 and, according to its EPS guidance of 4.77, an expected P/E ratio of 21.2. Neurocrine Biosciences's PEG ratio is 0.99 based on its 65.0% compound average growth rate of historical and projected earnings per share. However, we believe that it is more prudent to calculate the PEG ratio using the broader market's 5-year expected EPS growth rate of 11.4%, because the growth rate implied by Neurocrine Biosciences's past and expected EPS is probably not sustainable. This more prudent approach shows a PEG ratio of 5.62, which suggests that the company's shares are actually overvalued.

Neurocrine Biosciences's P/B ratio is 5.7 compared to its sector average of 4.16. The company is likely overvalued in terms of its net asset value. The company's shares are currently trading 281.7% above their fair value as expressed by Benjamin Graham's formula:

√(22.5 * 4-year average EPS * book value per share) = √(22.5 * 1.76 * 17.697) = $26.47

Neurocrine Biosciences's strong cash flow trend and reasonable levels of debt attenuate the company's lofty valuation in terms of earnings and assets.

Neurocrine Biosciences Is the Subject of Mixed Market Indicators:

23 analysts are following Neurocrine Biosciences and have set target prices ranging from $91.0 to $150.0 per share. On average, they have given the company a rating of buy. At the current price of $101.04, NBIX is trading -19.56% away from its average analyst target price of $125.61 per share, implying an analyst consensus of some upside potential for the stock.

The company has an average amount of shares sold short since 3.0% of the company's shares are tied to short positions. Institutions own 95.3% of Neurocrine Biosciences's shares, while the insider ownership rate stands at 1.06%. The biggest shareholder is Blackrock Inc. with a 13% stake in the company worth approximately $1,275,898,070.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.