By Contributor,Thomas Fuller,Trefis Team

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Photo Illustration by Thomas Fuller/SOPA Images/LightRocket via Getty Images
SOPA Images/LightRocket via Getty Images

Halozyme Therapeutics (HALO) stock could be a solid choice to leverage the current momentum. Why? Because it offers strong margins, a low-debt capital structure, reasonable valuation, and strong momentum. Here are some key data points.

Revenue Growth: Halozyme Therapeutics experienced revenue growth of 35.0% LTM and 35.5% over the last 3 years’ average.

Long-Term Profitability: Approximately 44.7% operating cash flow margin and 47.8% operating margin averaged over the last 3 years.

Strong Momentum: Currently in the top 10 percentile of stocks concerning “trend strength” – our proprietary momentum metric.

Room To Run: Despite its momentum, HALO stock is trading 17% lower than its 52-week high.

While revenue growth is beneficial, this selection focuses on harnessing momentum with quality – which we evaluate through margins (indicative of pricing power / robust business model) and capital structure (not excessively leveraged).

For context, Halozyme Therapeutics provides biopharma technology with ENHANZE drug delivery by utilizing recombinant hyaluronidase and develops treatments for non-Hodgkin lymphoma and chronic lymphocytic leukemia.

Comparison with benchmark medians

*LTM: Last Twelve Months

But do these figures represent the entire picture? Examine Buy or Sell HALO Stock to determine if Halozyme Therapeutics still possesses an advantage that remains solid upon closer inspection.

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This is one perspective to consider for stocks. Trefis High Quality Portfolio assesses far more and aims to mitigate stock-specific risk while providing exposure to potential gains.

Stocks Like These Can Outperform. Here Is Data

This is our approach for selection: We identify stocks with a market cap exceeding $2 billion, high operating and cash flow from operations (CFO) margins, no instance of over a 15% revenue decrease in the past five years, reasonable valuations, low-debt capital structures, and robust momentum as characterized by our proprietary momentum metric.

Below are statistics for stocks that adhered to this selection strategy between 12/31/2016 and 6/30/2025.

Average 12-month forward returns nearing 15%

12-month win rate (percentage of picks delivering positive returns) of approximately 60%

But Consider The Risk

However, HALO is not exempt from significant declines. It plunged around 74% during the Global Financial Crisis, which is quite a blow. The Inflation Shock resulted in a nearly 49% drop. Even the 2018 correction and the Covid sell-off affected it by more than 36%. Hence, despite solid fundamentals, HALO can still experience significant hits when the market turns unfavorable. Strong companies can also be bruised when panic strikes.

Nonetheless, the risk extends beyond major market downturns. Stocks can decline even during favorable market conditions – consider events such as earnings announcements, business updates, and shifts in outlook. Explore HALO Dip Buyer Analyses to understand how the stock has rebounded from sharp declines historically.

The Trefis High Quality (HQ) Portfolio, which comprises 30 stocks, has a proven record of comfortably exceeding its benchmark, including all three – the S&P 500, S&P mid-cap, and Russell 2000 indices. What accounts for this? Collectively, HQ Portfolio stocks generated superior returns with reduced risk compared to the benchmark index; they present less of a roller-coaster experience, as demonstrated in HQ Portfolio performance metrics.

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