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Halozyme Therapeutics (HALO)
NASDAQ:HALO
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Halozyme
(NASDAQ:HALO)79Outperform
Positive Factors
Earnings
Halozyme Therapeutics reported above-expected financial results for their 4Q24, including revenues of $298.0 million, up 29.5% year-over-year, and adjusted earnings per share of $1.26, as compared to $0.82 for the prior year period.
Strategic Partnerships
Management is confident that HALO will announce at least one new partnership deal in 2025.
Negative Factors
Patent Dispute
Merck is challenging Halozyme’s patents, which could impact the company's intellectual property on SC Keytruda.
Halozyme (HALO) vs. S&P 500 (SPY)
Market Cap
$7.33B
Dividend YieldN/A
Average Volume (3M)1.19M
Price to Earnings (P/E)17.5
Beta (1Y)1.23
Revenue Growth22.44%
EPS Growth63.47%
CountryUS
Employees350
SectorHealthcare
Sector Strength74
IndustryBiotechnology
Share Statistics
EPS (TTM)3.43
Shares Outstanding123,153,000
10 Day Avg. Volume1,336,187
30 Day Avg. Volume1,193,384
Financial Highlights & Ratios
PEG Ratio0.28
Price to Book (P/B)N/A
Price to Sales (P/S)7.22
Price to Cash Flow (P/CF)10.30
P/FCF Ratio10.30
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$66.11Price Target Upside8.41% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
Halozyme Business Overview & Revenue Model
Company DescriptionHalozyme Therapeutics, Inc. (HALO) is a biotechnology company that focuses on developing and commercializing products that target the extracellular matrix for the enhancement of the delivery of drugs and the treatment of tumors. The company operates primarily in the healthcare sector and is known for its proprietary enzyme technology, including the ENHANZE drug delivery platform, which is designed to facilitate the subcutaneous delivery of biologics, potentially improving patient experience and outcomes.
How the Company Makes MoneyHalozyme makes money primarily through collaborations and licensing agreements with pharmaceutical and biotechnology companies. The company's ENHANZE technology is licensed to partners who integrate it into their own therapeutic products. Halozyme receives revenue from these partnerships in the form of upfront payments, milestone payments, and royalties on sales of products that incorporate the ENHANZE technology. Additionally, the company may earn revenue from direct product sales and other strategic partnerships that leverage its proprietary platforms. Key partnerships with major pharmaceutical companies significantly contribute to Halozyme's revenue streams.
Halozyme Financial Statement Overview
Summary
Halozyme exhibits strong financial health with impressive revenue and profit growth, effective cost management, and robust cash flows. The elimination of debt enhances financial stability, although maintaining sustainable equity growth remains crucial.Income Statement
Halozyme has demonstrated strong revenue growth, with a significant increase from $267.6M in 2020 to over $1B in 2024, reflecting robust market expansion. Gross profit margin remains high at 84.3% in 2024, showcasing effective cost management. Net profit margin has improved to 43.7%, indicating enhanced profitability. Both EBIT and EBITDA margins are impressive at 54.3% in 2024, highlighting operational efficiency.88
Very Positive
Balance Sheet
The company has improved its financial stability, with stockholders' equity rising to $363.8M in 2024. The debt-to-equity ratio has improved significantly, with total debt being eliminated, enhancing financial resilience. The equity ratio has improved, indicating a stronger capital structure. However, the ROE at 122% reflects high profitability but could also point to a need for sustainable equity growth.70
Positive
Cash Flow
Halozyme has shown strong cash flow performance, with free cash flow growing consistently, reaching $468.4M in 2024. The operating cash flow to net income ratio is robust at 1.08, showcasing effective conversion of income into cash. Free cash flow to net income ratio stands at 1.06, reflecting efficient cash management. This solid cash flow supports future growth and operational flexibility.85
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 1.02B | 829.25M | 660.12M | 443.31M | 267.59M | Gross Profit |
| 855.91M | 636.89M | 520.81M | 361.90M | 224.23M | EBIT |
| 551.48M | 337.57M | 267.53M | 275.90M | 144.25M | EBITDA |
| 656.54M | 451.95M | 315.51M | 259.04M | 152.96M | Net Income Common Stockholders |
| 444.09M | 281.59M | 202.13M | 402.71M | 129.09M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 596.07M | 336.00M | 362.79M | 740.92M | 368.01M | Total Assets |
| 2.06B | 1.73B | 1.84B | 1.10B | 579.92M | Total Debt |
| 1.51B | 1.50B | 1.51B | 876.67M | 397.23M | Net Debt |
| 1.39B | 1.38B | 1.27B | 757.96M | 249.53M | Total Liabilities |
| 1.70B | 1.65B | 1.67B | 907.48M | 428.88M | Stockholders Equity |
| 363.82M | 83.81M | 169.80M | 196.95M | 151.05M |
| Cash Flow | Free Cash Flow | |||
| 468.37M | 373.28M | 235.30M | 297.98M | 52.95M | Operating Cash Flow |
| 479.06M | 388.57M | 240.11M | 299.44M | 55.45M | Investing Cash Flow |
| -262.72M | -96.91M | -487.00M | -406.29M | 78.35M | Financing Cash Flow |
| -218.86M | -407.99M | 362.37M | 77.86M | -106.28M |
Halozyme Technical Analysis
Positive
60.98
Price Trends
55.22
Positive
53.11
Positive
53.86
Positive
Market Momentum
1.17
Negative
70.87
Negative
89.05
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HALO, the sentiment is Positive. The current price of 60.98 is above the 20-day moving average (MA) of 58.28, above the 50-day MA of 55.22, and above the 200-day MA of 53.86, indicating a bullish trend. The MACD of 1.17 indicates Negative momentum. The RSI at 70.87 is Negative, neither overbought nor oversold. The STOCH value of 89.05 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HALO.
Halozyme Risk Analysis
Halozyme disclosed 38 risk factors in its most recent earnings report. Halozyme reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Halozyme Peers Comparison
Overall Rating
UnderperformOutperform
Sector (49)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $7.33B | 17.52 | 198.42% | ― | 22.44% | 63.47% | |
78 Outperform | $76.36B | 18.22 | 15.95% | 0.13% | 8.27% | 10.35% | |
75 Outperform | $144.51B | 303.37 | 2.28% | 2.65% | 6.16% | -91.54% | |
75 Outperform | $170.73B | 42.04 | 67.55% | 2.87% | 18.64% | -39.39% | |
69 Neutral | $21.57B | 13.45 | 10.36% | ― | -1.60% | 39.71% | |
64 Neutral | $126.25B | ― | -3.15% | ― | 11.64% | -114.72% | |
49 Neutral | $7.05B | 0.34 | -55.09% | 2.46% | 25.27% | -3.43% |
* Healthcare Sector Average
Performance Comparison
HALO
Halozyme
60.98
19.78
48.01%
AMGN
Amgen
324.86
57.65
21.57%
BIIB
Biogen
150.38
-79.69
-34.64%
GILD
Gilead Sciences
117.41
45.05
62.26%
REGN
Regeneron
707.51
-255.69
-26.55%
VRTX
Vertex Pharmaceuticals
488.29
73.82
17.81%
Halozyme Earnings Call Summary
Earnings Call Date: Feb 18, 2025 | % Change Since: 5.32% | Next Earnings Date: May 13, 2025
Earnings Call Sentiment Positive
The earnings call was largely positive, with record-breaking revenue, strong growth in key products, and an optimistic outlook for 2025 and beyond. While there were some setbacks, such as the delay in Amivantamab subcutaneous approval and temporary royalty rate impacts, these were overshadowed by the overall strong financial performance and strategic achievements.Highlights
Record-Breaking Revenue
Total revenue exceeded $1 billion for the first time, growing 22% year-over-year, driven by strong royalty revenue and strategic management.
Strong Royalty Revenue Growth
Royalty revenue grew 27% year-over-year, reaching $571 million, exceeding the raised guidance.
DARZALEX Subcutaneous Growth
Johnson & Johnson reported worldwide sales of DARZALEX grew 24%, driven by the subcutaneous version which holds 95% share of total sales in the US.
Phesgo Adoption
Phesgo sales increased 72% year-over-year, with strong uptake across all regions, reaching CHF1.7 billion for full year 2024.
VYVGART Hytrulo Success
VYVGART Hytrulo with ENHANZE drove significant growth, with full year revenue reaching $2.2 billion, aided by its ease of use and adoption in CIDP.
New Approvals and Pipeline Expansion
Significant approvals in 2024 included Ocrevus Zunovo, Tecentriq Hybreza, and Opdivo Qvantiq, with contributions expected to become meaningful in 2026 and beyond.
Financial Strength and Guidance
Adjusted EBITDA increased 48% to $632 million, with a strong balance sheet and projections for continued growth in 2025.
Lowlights
Amivantamab Subcutaneous Approval Delay
Johnson & Johnson received a complete response letter from the FDA for Amivantamab subcutaneous, delaying its US approval due to manufacturing inspection issues.
Royalty Rate Reset Impact
A temporary decrease in royalty revenue is expected in Q1 2025 due to annual contractual rate resets, notably impacting DARZALEX.
Company Guidance
During the call, Halozyme provided a detailed financial and operational update, highlighting record-breaking achievements in 2024 and offering guidance for 2025. The company reported total revenue exceeding $1 billion for the first time, marking a 22% growth over the previous year. Key financial metrics included royalty revenue growth of 27% to $571 million, a net income increase of 58% to $444 million, and an adjusted EBITDA of $632 million, up 48% year-over-year. For 2025, Halozyme projects total revenue between $1.15 billion and $1.225 billion, reflecting a 13% to 21% increase. Royalty revenues are expected to grow 27% to 31%, driven by products like DARZALEX subcutaneous, Phesgo, and VYVGART Hytrulo. The guidance also includes an adjusted EBITDA range of $755 million to $805 million, representing growth of 19% to 27%, and non-GAAP EPS between $4.95 and $5.35, indicating a 17% to 26% increase from 2024. The company remains confident in its long-term growth prospects, aiming for $1 billion in royalty revenue by 2027, supported by a robust pipeline and strategic partnerships.Halozyme Corporate Events
Executive/Board Changes
Halozyme Board Member Connie Matsui Steps Down
Neutral
Feb 13, 2025
On February 11, 2025, Connie L. Matsui, a long-serving member of Halozyme Therapeutics’ Board of Directors, announced her decision not to stand for reelection at the 2025 annual stockholders’ meeting. Her departure is amicable and not due to any disagreements with the company’s operations or strategies, and her contribution over nearly 18 years has been appreciated by the management and board.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.