Last Update19 Sep 25Fair value Increased 5.20%
Nektar Therapeutics’ consensus price target has increased to $101.17, driven by positive Phase 2b REZOLVE-AD results for rezpegaldesleukin, which demonstrated robust efficacy and safety in atopic dermatitis, supporting increased conviction in its differentiated clinical and commercial profile.
Analyst Commentary
- Bullish analysts are raising price targets following positive Phase 2b REZOLVE-AD data for rezpegaldesleukin, with all primary and secondary endpoints met and robust efficacy and safety demonstrated in moderate-to-severe atopic dermatitis.
- Strong patient-reported outcomes and induction efficacy have increased convictions in rezpegaldesleukin's differentiated profile and commercial potential against competitors, as recent competitor (Sanofi/amlitelimab) data was comparatively underwhelming.
- The mechanism of action for rezpegaldesleukin is viewed as highly novel and differentiated, with the potential to significantly reshape the atopic dermatitis treatment landscape.
- Upcoming catalyst-rich events, including further data from the 36-week maintenance and escape-arm studies, provide further upside risk to the share price.
- Bullish analysts highlight that Nektar's current market capitalization still represents a significant discount to the anticipated market opportunity for rezpegaldesleukin, supporting higher valuations.
What's in the News
- Rezpegaldesleukin, Nektar's IL-2 pathway agonist and Treg proliferator, showed statistically significant results in the 16-week induction period of the Phase 2b REZOLVE-AD trial for atopic dermatitis; the new data was presented at the European Academy of Dermatology and Venereology Congress.
- The FDA granted Fast Track designation for rezpegaldesleukin in moderate-to-severe atopic dermatitis for patients age 12+ and for severe-to-very severe alopecia areata for adults and pediatric patients age 12+ weighing at least 40 kg.
- A follow-on equity offering was completed, raising approximately $100 million through the sale of over 4.2 million shares at $23.50 each with a $1.41 discount per share; pre-funded warrants were also registered.
- Company executive officers and directors entered a 61-day lock-up agreement covering common stock, performance stock units, restricted stock units, and stock options, restricting insider sales and transfers.
- 2025 guidance reaffirmed with anticipated $40 million in noncash royalty revenue and a noncash loss of about $10 million for the year.
Valuation Changes
Summary of Valuation Changes for Nektar Therapeutics
- The Consensus Analyst Price Target has risen from $96.17 to $101.17.
- The Future P/E for Nektar Therapeutics has risen from 283.39x to 298.13x.
- The Consensus Revenue Growth forecasts for Nektar Therapeutics remained effectively unchanged, at -18.3% per annum.
Key Takeaways
- Advancing innovative therapies like REZPEG in large, underserved markets could drive substantial revenue growth and improve long-term financial performance.
- Strong cash reserves and accelerated regulatory paths enable operational stability, support pipeline expansion, and reduce near-term financial risks.
- Heavy reliance on REZPEG's uncertain success, persistent losses, strong competition, and funding risks threaten Nektar's future growth, shareholder value, and pipeline sustainability.
Catalysts
About Nektar Therapeutics- A biopharmaceutical company, focuses on discovering and developing therapies that selectively modulate the immune system to treat autoimmune disorders in the United States and internationally.
- Strong initial Phase IIb and ongoing data for REZPEG in atopic dermatitis, combined with a large and growing addressable market (expected to reach nearly $30B by 2033), position Nektar to access significant new revenue streams and improve long-term earnings as the population ages and chronic inflammatory diseases rise globally.
- FDA Fast Track designation for REZPEG in both atopic dermatitis and alopecia areata gives Nektar an accelerated regulatory path, potentially reducing time to market and R&D costs, which should improve net margins and cash flow if approvals are achieved ahead of competitors.
- Positive emerging data and differentiation from existing therapies (e.g., faster onset, fewer side effects, novel mechanism) increase the probability of commercial success and uptake in a market moving toward personalized, immune-modulating treatments, supporting future top-line revenue growth.
- Robust cash position after the recent equity raise extends runway into 2027, providing operational stability to advance late-stage assets and initiate Phase III trials without near-term dilution or financing risk, which supports earnings predictability and reduces financial leverage concerns.
- Broadening of pipeline applications (e.g., immunology, autoimmune, dermatology) and the prospect of international partnerships or strategic out-licensing align with the global expansion of healthcare access, providing opportunities for diversified and growing revenue streams in coming years.
Nektar Therapeutics Future Earnings and Revenue Growth
Assumptions
How have these above catalysts been quantified?- Analysts are assuming Nektar Therapeutics's revenue will decrease by 18.3% annually over the next 3 years.
- Analysts are not forecasting that Nektar Therapeutics will become profitable in next 3 years. To represent the Analyst Price Target as a Future PE Valuation we will estimate Nektar Therapeutics's profit margin will increase from -163.2% to the average US Pharmaceuticals industry of 23.2% in 3 years.
- If Nektar Therapeutics's profit margin were to converge on the industry average, you could expect earnings to reach $9.5 million (and earnings per share of $0.41) by about September 2028, up from $-122.3 million today.
- In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 283.4x on those 2028 earnings, up from -4.4x today. This future PE is greater than the current PE for the US Pharmaceuticals industry at 19.5x.
- Analysts expect the number of shares outstanding to grow by 7.0% per year for the next 3 years.
- To value all of this in today's terms, we will use a discount rate of 6.78%, as per the Simply Wall St company report.
Nektar Therapeutics Future Earnings Per Share Growth
Risks
What could happen that would invalidate this narrative?- Nektar Therapeutics remains a pre-commercial, loss-making company with no approved products-its net loss was $41.6 million in Q2 2025 and the company projects continued high R&D and G&A expenses through at least 2026, putting medium-term pressure on cash reserves, future earnings, and diluting value for shareholders unless a major partnership, out-licensing, or additional funding is secured.
- The long-term business model is highly reliant on REZPEG's clinical and regulatory success; prior pipeline setbacks (e.g., bempegaldesleukin failure) raise concerns about execution risk and the company's ability to consistently deliver differentiated, market-competitive assets, directly impacting long-term revenue, investor confidence, and net margins.
- Intense competition and rapid innovation in the immunology and dermatology space-from existing IL-13, OX40, JAK inhibitors, and new modalities like cell and gene therapies-may limit REZPEG's market share or render its technology less differentiated, constraining its potential revenue growth in the face of larger, better-capitalized competitors.
- Extended timelines, high costs of late-stage development, and reliance on favorable regulatory outcomes (notwithstanding Fast Track designation) expose Nektar to risk from increasing regulatory scrutiny, potential delays, and stricter efficacy/safety benchmarks, which could delay commercialization and thus delay or reduce potential revenue and profitability.
- Heightened macroeconomic volatility and tightening capital markets environment makes it more challenging for clinical-stage biotech firms like Nektar to secure favorable financing or partnership terms, which risks future cash flow shortages and could force cost-cutting or pipeline downsizing, negatively impacting R&D progress and long-term earnings prospects.
Valuation
How have all the factors above been brought together to estimate a fair value?- The analysts have a consensus price target of $96.167 for Nektar Therapeutics based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $120.0, and the most bearish reporting a price target of just $69.0.
- In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $40.9 million, earnings will come to $9.5 million, and it would be trading on a PE ratio of 283.4x, assuming you use a discount rate of 6.8%.
- Given the current share price of $28.55, the analyst price target of $96.17 is 70.3% higher. Despite analysts expecting the underlying buisness to decline, they seem to believe it's more valuable than what the market thinks.
- We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.
How well do narratives help inform your perspective?
Disclaimer
AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.