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It is getting significantly harder to find growth stocks at a reasonable price after the rally of the last few months. One growth stock that I still like here and think has substantial upside is Jazz Pharmaceuticals (NASDAQ:JAZZ). The stock is still cheap given its substantial growth prospects and analysts have made several positive comments recently.

Recent positives for JAZZ:

  • Cantor Fitzgerald just initiated the shares as a "Buy" and put a $86 a share price target on the stock, more than 40% above its current price.
  • WallachBeth also raised its price target to $70 from $63 a share for Jazz Pharmaceuticals following the company's better than expected Q4 results recently. It also reiterates a Buy rating on the stock.
  • Consensus earnings estimates for both FY2013 and FY2014 have risen nicely over the last month.

Jazz Pharmaceuticals Public Limited Company is a specialty biopharmaceutical company. It has several specialty products in production including Xyrem for the treatment of cataplexy and excessive daytime sleepiness in patients with narcolepsy; Erwinaze to treat acute lymphoblastic leukemia and Prialt for the management of severe chronic pain.

4 reasons JAZZ has upside from under $60 a share:

  1. Earnings are climbing rapidly. The company made $2.67 a share in FY2011 and $4.82 in FY2012. Analysts project over $5.75 in EPS in FY2013 and over $7 in FY2014.
  2. Earnings are being powered by large revenue growth. The consensus projection is the company will increase sales better than 40% in FY2013 and over 15% in FY2014.
  3. The company has more than quadrupled operating cash flow in the last three years and also benefits from lower tax rates than competitors due to being based in Ireland.
  4. The stock is selling in the bottom third of its five year valuation range based on P/E, P//S and P/B. JAZZ also has a minuscule five year projected PEG (.37).
Source: Jazz Pharmaceuticals: Playing A Sweet Song For Growth Investors