Buffett Brain · Research note
Score updated 26 Sept 2026 · analysis from 22 May 2026
CPRX· Healthcare
Catalyst Pharmaceuticals
Catalyst Pharmaceuticals exhibits strong profitability metrics but valuation and financial health raise concerns.
Buffett fit
Partial fit
Owner
84
Durability
90
Management
70
Price
30
Score updated 26 Sept 2026 · analysis from 22 May 2026
Buffett's checklist
Each number against Buffett's bar, and where it ranks among Healthcare stocks in our database.
How much profit the business makes on each dollar invested in it. Higher is better.
What is left of each sale after the cost of making the product. A high number often means pricing power.
The cash the business earns for its owners, compared with the price of the whole company.
How fast sales grew each year over the last five years.
How many years of today's profit you pay for at today's price. Lower means cheaper.
How much the company owes compared with what it owns outright. Lower is safer.
The four pillars
How the business measures up on each of Buffett's four tests.
If we owned 100% of Catalyst Pharmaceuticals, we'd be pleased with its high of 19.67% and consistent profitability over the past five years.
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The 10-year test shows strength, with a 5-year EPS CAGR of 46.49% and consistent profitability.
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Management has shown discipline with a yield of 0.23% and no dividends, focusing on reinvestment.
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With an earnings yield of 5.8% and yield of 5.46%, the valuation is not compelling against a desired 8-10% yield.
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For and against
The strongest points on each side, with the numbers behind them.
In its favor
6- 1 of 19.67% is top-quintile in the healthcare sector.
- 2 of 82.32% indicates strong .
- 3Net margin of 37.08% reflects efficient operations.
- 4Revenue CAGR of 43.0% over the past five years shows strong growth.
Concerns
5- 1 of 17.3 and earnings yield of 5.8% suggest limited .
- 2Share count CAGR of 4.29% indicates shareholder dilution.
- 3 YoY growth of -12.81% raises questions about cash flow stability.
- 4Valuation metrics do not yet align with desired 8-10% yield.
Price history
$31.49+446.7%· 5-year return
Weekly closing prices. Touch or hover the line for a date.
The business
How the business works
Catalyst Pharmaceuticals focuses on developing therapies for rare neuromuscular diseases, primarily through its product Firdapse. The company generated $588.99M in revenue with a net margin of 37.08%, indicating strong profitability. Its of 82.32% suggests substantial . Unit economics are favorable with /Net Income at 0.97, showing high earnings quality.
What other investors would say
The same company, judged by three other documented playbooks.
Keep researching
Similar companies in Healthcare
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