BIOMARIN PHARMACEUTICAL INC

Where It Passes

Where It Falls Short

• Profitability6% pass✓ 7✗ 28▾

  15 of 16 flag BMRN's profitability — Graham, Buffett, Lynch +12 more

  Positive EPS (10 years)7/28 years positive

  ✗GrahamPositive EPS every year for 10 years

  EPS Growth (3-yr avg, 10-yr window)

  ✗Graham>= 33% growth

  Net Income Positive (10+ years)11/28 years positive

  ✗BuffettPositive every year for 10+ years

  ROE (up to 5-year arithmetic mean)3.6%

  ✗Buffett> 15% arithmetic mean (app rule)

  Operating Margin (10-yr trend)12.7% (latest)

  ✗BuffettStable or rising over 10 years

  Free Cash Flow Proxy$348.9M

  ✓BuffettPositive and growing

  Earnings Variance (10-yr CoV)14.83

  ✗BuffettCoV < 0.3

  Retained Earnings Effectiveness

  ✗Buffett$1 retained -> > $1 market value created

  Basic earnings-growth PEG (dividends excluded)P/E 31.8x (growth N/A)

  ✗Lynch< 1.0 (ideally < 0.5)

  3-5 Year EPS CAGR-16.9%

  ✗Lynch15-30% (Fast Grower); > 0% to pass

  ROE-0.3%

  ✗Lynch> 15%

  EBIT / Enterprise Value0.8%

  ✗Greenblatt> 10%

  Earnings Yield + ROC AssessmentEY=0.8%, ROC=3.5%

  ✗GreenblattBoth EY > 10% and ROC > 25%

  Net Income / Total Assets4.59%

  ✓PiotroskiROA > 0

  ROA Change YoY6.11% -> 4.59% (delta: -1.51%)

  ✗PiotroskiCurrent ROA > Prior ROA

  (CFO / Total Assets) vs ROACFO/Assets=10.90%, ROA=4.59%

  ✓PiotroskiCFO/Assets > ROA

  Gross Margin Change YoY79.7% -> 77.7%

  ✗PiotroskiImproved YoY

  Pre-Tax Income / Revenue1.2%

  ✗Dreman>= 8%

  Net Income / Shareholders' Equity-0.3%

  ✗Dreman> 12%

  Margin of SafetyP/E=31.8x, P/B=1.8x

  ✗PabraiP/B < 1.5 or P/E < 15

  Return on Equity5.6% (3-yr avg)

  ✗AkreROE > 20% (3-year avg)

  Discount to Intrinsic Value-134.5% (IV=$24.40 vs Price=$57.23)

  ✗Marks>= 20% below intrinsic value

  Positive Net Income Frequency11/22 years positive

  ✓MarksPositive net income in >= 7 of last 10 years

  Operating Income / Revenue3.1%

  ✗Ackman>= 15%

  Net Income / Shareholders Equity-0.3%

  ✗Ackman>= 15%

  5-Year EPS CAGR-16.9% CAGR over 5 years

  ✗Templeton> 0% (5-year EPS CAGR)

  Operating Margin Trend7.7% (2023) -> 12.7% (2025)

  ✓TempletonNon-negative operating-margin trend over 3 years

  Revenue growth vs. gross and operating margin trendgross margin 78.0% -> 77.7%, operating margin 7.7% -> 12.7%

  ✓SleepRevenue rising; gross margin flat or falling; operating margin holding

  Net income / market capitalization-0.17%; #3244/6340 (top 51.2%)

  ✗AsnessTop 30% of eligible cross-section✗OshaughnessyTop 10% of eligible cross-section

  Gross profit / total assets+32.97%; #1273/3702 (top 34.4%)

  ✗AsnessTop 30% of eligible cross-section

  Net income / positive book equity-0.31%; #2941/5226 (top 56.3%)

  ✗AsnessTop 30% of eligible cross-section

  Negative 5-year standard deviation of ROA-0.0243; #1667/5884 (top 28.3%)

  ✓AsnessTop 30% of eligible cross-section

  3-5 Year Diluted EPS CAGR-16.9% over 5 years

  ✗Neff7%-20% annualized

  Positive Diluted-EPS Years5/10 years positive

  ✗Schloss>= 70% positive over 5-10 observed years (app rule)
• Valuation8% pass✓ 4✗ 24▾

  12 of 13 flag BMRN's valuation — Graham, Lynch, Greenblatt +9 more

  Price / 3-yr avg EPS35.2x

  ✗Graham<= 15x

  Price-to-Book Ratio1.8x

  ✗Graham<= 1.5x

  P/E x P/B63.60

  ✗Graham<= 22.5

  Basic earnings-growth PEG (dividends excluded)P/E 31.8x (growth N/A)

  ✗Lynch< 1.0 (ideally < 0.5)

  EBIT / Enterprise Value0.8%

  ✗Greenblatt> 10%

  Earnings Yield + ROC AssessmentEY=0.8%, ROC=3.5%

  ✗GreenblattBoth EY > 10% and ROC > 25%

  Price / EPS31.8x

  ✗Dreman< 12x✗Templeton< 12x (fixed ceiling; proxy for the market's cheapest 40%)

  Price / (CFO / Shares)13.3x

  ✗Dreman< 8x

  Price / Book Value per Share1.8x

  ✗Dreman< 1.2x✗Templeton< 1.5x✗SchlossP/B <= 0.80x (app cutoff)

  Valuation ReasonablenessP/E=31.8x, OE Yield=3.0%

  ✗MungerP/E < 25 or Owner Earnings Yield > 5%

  P/E or FCF YieldP/E=31.8x, FCF Yield=6.5%

  ✗PabraiP/E < 15 or FCF Yield > 10%

  P/B or P/E vs. Historical AverageP/E=31.8x, P/B=1.8x

  ✓MarksP/E < 15 or P/B < 2.0

  Discount to Intrinsic Value-134.5% (IV=$24.40 vs Price=$57.23)

  ✗Marks>= 20% below intrinsic value

  Price / FCF per Share15.2x

  ✓Ackman<= 25

  Price vs. Trailing Low107% of trailing low ($53.57)

  ✓Templeton<= 120% of trailing low (certified split-adjusted live window)

  Net income / market capitalization-0.17%; #3244/6340 (top 51.2%)

  ✗AsnessTop 30% of eligible cross-section✗OshaughnessyTop 10% of eligible cross-section

  Positive book equity / market capitalization+0.5644; #2630/6449 (top 40.8%)

  ✗AsnessTop 30% of eligible cross-section

  Price / Diluted EPS31.8x

  ✗NeffP/E <= 15x (app proxy for a P/E 40%-60% below the market)

  (EPS CAGR % + Dividend Yield %) / P/E

  ✗Neff> 0.7 (Neff's published traditional edge)

  Price / Tangible Book Value per Share1.94x

  ✗SchlossP/TBV <= 1.00x (app cutoff)

  Book Value per Share Change+40.3%

  ✓SchlossLatest BVPS >= earliest BVPS over >= 3 years (app rule)

  Revenue / market capitalization+0.3297; #3186/5247 (top 60.7%)

  ✗OshaughnessyTop 10% of eligible cross-section

  (Operating cash flow - capex) / market capitalization+5.03%; #1574/4519 (top 34.8%)

  ✗OshaughnessyTop 10% of eligible cross-section

  Trailing six-month price return through the evaluation date+4.95%; #2170/6202 (top 35.0%)

  ✗OshaughnessyTop 10% of eligible cross-section
• Valuation models22% pass✓ 2✗ 7▾

  Models split on BMRN at $57.23 — fair values range $7.09–$135.04

  Graham fair value$35.80

  ✗Graham-59.9% margin vs $57.23

  Buffett fair value$31.69

  ✗Buffett-80.6% margin vs $57.23

  Greenblatt fair value$14.78

  ✗Greenblatt-287.2% margin vs $57.23

  Dreman fair value$24.40

  ✗Dreman-134.5% margin vs $57.23

  Munger fair value$64.93

  ✓Munger+11.9% margin vs $57.23

  Pabrai fair value$27.09

  ✗Pabrai-111.3% margin vs $57.23

  Marks fair value$7.09

  ✗Marks-707.2% margin vs $57.23

  Ackman fair value$135.04

  ✓Ackman+57.6% margin vs $57.23

  Templeton fair value$15.84

  ✗Templeton-261.3% margin vs $57.23
• Efficiency25% pass✓ 3✗ 8▾

  6 of 8 flag BMRN's efficiency — Buffett, Greenblatt, Piotroski +3 more

  Current Ratio2.44

  ✓Graham>= 2.0

  ROIC (3-5 yr avg)3.4%

  ✗Buffett> 10%

  ROIC - WACC-6.6%

  ✗BuffettPositive (WACC = 10%)

  EBIT / (NWC + Net Fixed Assets)3.5%

  ✗Greenblatt> 25%

  Current Ratio Change YoY5.33 -> 5.21

  ✗PiotroskiIncreased YoY

  Revenue / Total Assets Change YoY0.41x -> 0.42x

  ✓PiotroskiImproved YoY

  Current Assets / Current Liabilities2.44

  ✓Dreman> 1.5

  Return on Invested Capital0.9%

  ✗Munger> 15%

  ROIC (high and growing)FY2023: ROIC=2.4%; FY2024: ROIC=6.1%; FY2025: ROIC=4.8%

  ✗AkreLatest 3 consecutive FYs: ROIC > 15% in each

  Reinvestment Rate x ROIC4.8% (RR=100% x ROIC=4.8%)

  ✗AkreReinvestment Rate * ROIC > 10%

  ROIC (5-year)0/5 years above 12% (latest 4.8%)

  ✗SleepROIC > 12% in a majority of years
• Verdicts31% pass✓ 5✗ 11▾

  Split decision: 10 FAIL · 4 PASS · 1 BUY · 1 NEUTRAL

  Overall verdict

  ✗GrahamFAIL (2/9)✗BuffettFAIL (1/9)✗LynchFAIL (0/7)✗GreenblattRank #1770✓PiotroskiPASS (F-Score 5)✓DremanPASS (5/11)✗MungerFAIL (0/4)✗PabraiFAIL (0/3)✗AkreFAIL (1/6)✗MarksFAIL (2/5)✓AckmanBUY (7/9)✓TempletonPASS (4/8)✓SleepPASS (3/6)✗AsnessFAIL (Rank #1175/2370 (Top 49.6%))✗NeffFAIL (2/6)✗SchlossFAIL (3/7)•OshaughnessyNEUTRAL (Not ranked)
• Cash Flow40% pass✓ 6✗ 6▾

  6 of 10 flag BMRN's cash flow — Lynch, Dreman, Pabrai +3 more

  Free Cash Flow Proxy$348.9M

  ✓BuffettPositive and growing

  FCF Positive and Growing$557.9M

  ✗LynchPositive and growing

  Operating Cash Flow$828.0M

  ✓PiotroskiCFO > 0

  (CFO / Total Assets) vs ROACFO/Assets=10.90%, ROA=4.59%

  ✓PiotroskiCFO/Assets > ROA

  Price / (CFO / Shares)13.3x

  ✗Dreman< 8x

  P/E or FCF YieldP/E=31.8x, FCF Yield=6.5%

  ✗PabraiP/E < 15 or FCF Yield > 10%

  FCF Positive5/18 years FCF positive

  ✗MarksPositive FCF in majority of recent years

  (OCF - CapEx) / Market Cap5.1%

  ✓Ackman>= 4%

  Price / FCF per Share15.2x

  ✓Ackman<= 25

  Positive Operating Cash Flow frequency12/18 years positive

  ✗SleepPositive OCF in >= 70% of available years

  Operating Cash Flow - Capital Expenditures$557.9M

  ✓Neff> $0 (app proxy for a strong fundamental case)

  (Operating cash flow - capex) / market capitalization+5.03%; #1574/4519 (top 34.8%)

  ✗OshaughnessyTop 10% of eligible cross-section
• Debt & Leverage42% pass✓ 7✗ 8▾

  7 of 12 flag BMRN's debt & leverage — Graham, Buffett, Lynch +4 more

  LT Debt vs Net Current AssetsLT Debt $3.5B vs NCA $2.3B

  ✗GrahamLT Debt <= Net Current Assets

  Debt/Equity & Interest CoverageD/E: 0.67, IC: 0.9x

  ✗BuffettD/E < 0.5 AND Interest Coverage > 5x

  Total Debt / Equity0.67

  ✗Lynch< 0.33

  Cash - Long-term Debt$-2.8B

  ✗LynchPositive preferred

  LT Debt / Total Assets Change0.00% -> 0.00%

  ✓PiotroskiDecreased YoY

  Current Assets / Current Liabilities2.44

  ✓Dreman> 1.5✓SchlossCurrent ratio >= 1.50x (app cutoff)

  Total Debt / Shareholders' Equity0.67

  ✓Dreman< 0.8✓Templeton< 1.0 (fixed cap; proxy for below-sector-median leverage)✓SchlossD/E < 1.00x

  Debt Levels0.67

  ✗MungerDebt/Equity < 0.5✗AkreDebt/Equity < 0.3

  Interest Coverage & Debt/EBITDAIC=0.9x, D/EBITDA=11.0x

  ✗MarksInterest Coverage > 3x; Debt/EBITDA < 4x

  Total Debt / Shareholders Equity0.67

  ✓Ackman<= 1.0

  Negative debt-to-equity (higher means less debt)-0.6671; #2776/4210 (top 65.9%)

  ✗AsnessTop 30% of eligible cross-section
• Growth50% pass✓ 7✗ 6▾

  4 of 8 pass — Graham, Lynch, Templeton +1 more object

  EPS Growth (3-yr avg, 10-yr window)

  ✗Graham>= 33% growth

  Basic earnings-growth PEG (dividends excluded)P/E 31.8x (growth N/A)

  ✗Lynch< 1.0 (ideally < 0.5)

  3-5 Year EPS CAGR-16.9%

  ✗Lynch15-30% (Fast Grower); > 0% to pass

  Inventory Growth vs Revenue GrowthInv: 29.9% vs Rev: 18.1%

  ✗LynchInventory growth < Revenue growth

  EPS Growth Direction$0.29 (2008) -> $1.80 (2025)

  ✓DremanPositive over recent years

  EPS CAGR11.3% CAGR over 17 years

  ✓Dreman> 5% annualized

  Positive Net Income Frequency11/22 years positive

  ✓MarksPositive net income in >= 7 of last 10 years

  3yr Median Revenue Growth15.4%

  ✓Ackman>= 5%

  Positive EPS Growth Frequency3/5 years with positive EPS growth

  ✓AckmanPositive EPS growth in >= 3 of last 5 years

  5-Year EPS CAGR-16.9% CAGR over 5 years

  ✗Templeton> 0% (5-year EPS CAGR)

  Revenue growth vs. gross and operating margin trendgross margin 78.0% -> 77.7%, operating margin 7.7% -> 12.7%

  ✓SleepRevenue rising; gross margin flat or falling; operating margin holding

  5-year Revenue CAGR11.6%

  ✓SleepCAGR > 7%

  3-5 Year Diluted EPS CAGR-16.9% over 5 years

  ✗Neff7%-20% annualized