3 Reasons CORT is Risky and 1 Stock to Buy Instead

Corcept currently trades at $73.44 and has been a dream stock for shareholders. It’s returned 346% since July 2020, blowing past the S&P 500’s 94% gain. The company has also beaten the index over the past six months as its stock price is up 32.8% thanks to its solid quarterly results.

Is there a buying opportunity in Corcept, or does it present a risk to your portfolio? See what our analysts have to say in our full research report, it’s free.

Why Is Corcept Not Exciting?

We’re glad investors have benefited from the price increase, but we're cautious about Corcept. Here are three reasons why CORT doesn't excite us and a stock we'd rather own.

1. Shrinking Adjusted Operating Margin

Adjusted operating margin is a key measure of profitability. Think of it as net income (the bottom line) excluding the impact of non-recurring expenses, taxes, and interest on debt - metrics less connected to business fundamentals.

Analyzing the trend in its profitability, Corcept’s adjusted operating margin decreased by 16.2 percentage points over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability. Its adjusted operating margin for the trailing 12 months was 16.2%.

2. EPS Trending Down

We track the long-term change in earnings per share (EPS) because it highlights whether a company’s growth is profitable.

Sadly for Corcept, its EPS declined by 3% annually over the last five years while its revenue grew by 15.4%. This tells us the company became less profitable on a per-share basis as it expanded.

3. Free Cash Flow Margin Dropping

Free cash flow isn't a prominently featured metric in company financials and earnings releases, but we think it's telling because it accounts for all operating and capital expenses, making it tough to manipulate. Cash is king.

As you can see below, Corcept’s margin dropped by 16.1 percentage points over the last five years. It may have ticked higher more recently, but shareholders are likely hoping for its margin to at least revert to its historical level. If the longer-term trend returns, it could signal it is in the middle of an investment cycle. Corcept’s free cash flow margin for the trailing 12 months was 25.8%.

Final Judgment

Corcept’s business quality ultimately falls short of our standards. With its shares outperforming the market lately, the stock trades at 36.1× forward P/E (or $73.44 per share). This valuation tells us it’s a bit of a market darling with a lot of good news priced in - we think there are better stocks to buy right now. We’d suggest looking at the most entrenched endpoint security platform on the market.

High-Quality Stocks for All Market Conditions

The market surged in 2024 and reached record highs after Donald Trump’s presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.

While the crowd speculates what might happen next, we’re homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver’s seat and build a durable portfolio by checking out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.

StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.