Examining Exelixis – Beyond Technicals to Assess Fundamentals

Now trading at a price of $23.14, Exelixis has moved -1.5% so far today.

Exelixis returned gains of 15.1% last year, with its stock price reaching a high of $24.34 and a low of $18.08. Over the same period, the stock underperformed the S&P 500 index by -11.6%. The company's 50-day average price was $22.16. Exelixis, Inc., an oncology company, focuses on the discovery, development, and commercialization of new medicines for difficult-to-treat cancers in the United States. Based in Alameda, CA, the Mid-Cap Health Care company has 1,310 full time employees. Exelixis has not offered a dividend during the last year.

Increasing Revenues but Narrowing Margins:

2017 2018 2020 2021 2022 2023
Revenue (M) $452 $854 $968 $988 $1,611 $1,830
Operating Margins 37% 51% 38% 11% 13% 9%
Net Margins 34% 81% 33% 11% 11% 11%
Net Income (M) $154 $690 $321 $112 $182 $208
Diluted Shares (M) 312 313 309 322 325 321
Earnings Per Share $0.49 $2.21 $1.02 $0.35 $0.56 $0.65
EPS Growth n/a 351.02% -53.85% -65.69% 60.0% 16.07%
Avg. Price $26.66 $21.36 $21.45 $20.87 $20.14 $23.14
P/E Ratio 51.27 9.21 20.24 57.97 35.33 35.6
CAPEX (M) $5 $64 $13 $30 $28 $40
Current Ratio 4.21 8.5 6.99 5.43 4.99 3.34

Exelixis has rapidly growing revenues and a flat capital expenditure trend, an excellent current ratio of 3.34, and positive EPS growth. However, the firm has weak operating margins with a negative growth trend.

a Lower P/B Ratio Than Its Sector Average but Trades Above Its Graham Number:

Exelixis has a trailing twelve month P/E ratio of 34.1, compared to an average of 30.21 for the Health Care sector. Based on its EPS guidance of $1.46, the company has a forward P/E ratio of 15.2. Exelixis's PEG ratio is 2.73 on the basis of the 12.5% weighted average of the company and the broader market's EPS compound average growth rates. This suggests that the company's shares are overvalued. In contrast, the market is likely undervaluing Exelixis in terms of its equity because its P/B ratio is 3.09 while the sector average is 4.08. The company's shares are currently trading 128.0% below their Graham number.

Exelixis Has an Average Rating of Buy:

The 19 analysts following Exelixis have set target prices ranging from $18.0 to $32.0 per share, for an average of $26.74 with a buy rating. The company is trading -13.5% away from its average target price, indicating that there is an analyst consensus of some upside potential.

Exelixis has an average amount of shares sold short because 3.1% of the company's shares are sold short. Institutions own 87.6% of the company's shares, and the insider ownership rate stands at 2.34%, suggesting a decent amount of insider shareholders. The largest shareholder is Blackrock Inc., whose 12% stake in the company is worth $833,373,934.

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.