ALM: Future Re-Rating Will Depend On Dermatology Execution And Pipeline Delivery

Analysts have modestly raised their 12 month price target for Almirall to EUR 14.50, citing expectations that a continued re rating driven by Ebglyss ramp up, upcoming clinical readouts, and potential in licensing and M&A could support upside from current levels.

Analyst Commentary

Analysts note that Almirall's investment case is increasingly driven by visible growth levers in medical dermatology, but also caution that execution on product ramps and pipeline milestones will be critical to sustaining the recent share price rebound.

Bullish Takeaways

• Bullish analysts argue that the current valuation remains compelling relative to the company’s medium term growth profile, even after the recent share price recovery.
• The anticipated ramp up of Ebglyss is seen as a key catalyst, with expectations that launch performance could exceed current market forecasts and support further multiple expansion.
• Upcoming clinical readouts are viewed as potential de risking events that could validate the dermatology focused R&D strategy and extend the growth runway beyond the near term.
• Active in licensing and disciplined M&A to bolster the mid stage pipeline are seen as tools that can accelerate portfolio diversification and underpin sustained top line growth.

Bearish Takeaways

• Bearish analysts highlight that continued re rating now depends heavily on flawless execution of the Ebglyss rollout, with any delays or weaker than expected uptake likely to cap valuation upside.
• There is concern that a larger portion of the equity story is shifting toward unproven pipeline assets, increasing sensitivity to negative or inconclusive clinical readouts.
• Reliance on in licensing and M&A to strengthen the mid stage pipeline introduces integration and capital allocation risks, which could dilute returns if deals are not priced and executed carefully.
• Some investors may question the durability of the current momentum if broader market volatility or sector specific sentiment turns less favorable for mid cap European biopharma names.

What's in the News

• Reiterated 2025 guidance for double digit net sales growth of 10% to 13%, underscoring management confidence in the dermatology portfolio and launch trajectory (Corporate guidance).
• Reported two year real world results from the POSITIVE study showing tildrakizumab delivers sustained improvements in both skin outcomes and psychological well being for moderate to severe psoriasis patients, aligning with WHO calls for holistic care (POSITIVE phase IV RWE study).
• Highlighted that POSITIVE is the first dermatology RWE study to use the WHO 5 Well Being Index as a primary endpoint, signaling a shift toward measuring mental health and partner impact alongside traditional psoriasis scores (POSITIVE phase IV RWE study).
• Showcased broad scientific visibility at the 34th EADV Congress with 44 abstracts and two expert led symposia, reinforcing Almirall's positioning as a leading medical dermatology player (EADV 2025 congress).
• Presented interim real world ADlife data indicating lebrikizumab achieves rapid, clinically relevant improvement in moderate to severe atopic dermatitis symptoms within four weeks and maintains a consistent safety profile (ADlife RWE study).

Valuation Changes

• Fair Value: Essentially unchanged, edging down marginally from €13.87 to €13.86 per share, indicating a stable intrinsic valuation view.
• Discount Rate: Held steady at 7.65%, reflecting no change in perceived risk profile or cost of capital assumptions.
• Revenue Growth: Maintained at approximately 10.08% per year, with only a negligible technical adjustment, signaling unchanged top line expectations.
• Net Profit Margin: Stable at around 10.69%, with only an immaterial rounding difference in the updated model.
• Future P/E: Trimmed very slightly from 24.37x to 24.35x, suggesting virtually no change in the longer term earnings multiple assumption.