Alvotech (NasdaqGM:ALVO) Valuation in Focus After UK Legal Win and Swing to Net Income

Alvotech (NasdaqGM:ALVO) is in the spotlight after reporting a sharp turnaround to net income and securing a favorable UK High Court ruling on its Eylea biosimilar, AVT06. Both developments are drawing increased attention from market watchers.

See our latest analysis for Alvotech.

After a difficult stretch for shareholders, Alvotech’s recent net income turnaround and favorable UK court ruling may be helping sentiment recover, especially after sharp declines earlier this year. Even with a 9.1% share price rebound over the past week, momentum has generally been weak. This is reflected in a one-year total shareholder return of -54.3%, which speaks to the challenges the company has faced on multiple fronts.

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With shares still trading far below analyst targets despite the company’s recent earnings rebound and legal win, the big question is whether Alvotech remains undervalued or if the market is already pricing in future growth.

Most Popular Narrative: 65.7% Undervalued

With the most widely tracked narrative setting Alvotech’s fair value at $16.10 per share, the current price of $5.52 reflects a deep gap between market pricing and projected company fundamentals. This narrative attempts to bridge that gap through assumptions about pipeline approvals, future profitability, and margin recovery.

Alvotech’s expanding global rollout and market share gains for its leading biosimilars, especially Humira and STELARA, signal continued growth as payers worldwide accelerate the shift to biosimilars, directly supporting future revenue and cash flow growth. Ongoing launch and approval pipeline activity, including upcoming regulatory decisions in major global markets (for AVT03, AVT05, AVT23, and others), positions the company to tap into blockbuster biologic markets coming off-patent, potentially driving a step-change in topline revenue once approvals are secured.

Read the complete narrative.

Want to uncover the math behind Alvotech's potential breakout? The heart of this narrative lies in bold revenue bets, margin expansion, and future profit multiples that could redefine investor expectations. The next move is hidden within the assumptions driving that high fair value. Discover what could send this stock soaring. Read the full narrative to see what’s fueling market optimism.

Result: Fair Value of $16.10 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent regulatory hurdles or further delays in biosimilar approvals could quickly dampen sentiment and undermine investor optimism around Alvotech’s turnaround story.

Find out about the key risks to this Alvotech narrative.

Another View: What Does the Market Multiple Say?

While the dominant undervalued narrative relies on pipeline-driven fair value, the market’s price-to-earnings ratio offers a more cautious signal. Alvotech trades at 27.3x, which is higher than the US Biotechs industry’s 18.3x average, but below similar peers at 37.7x. The so-called fair ratio is even higher at 34.2x. This gap could indicate that investors are factoring in more risk or may not trust future projections. Whether the market’s skepticism will persist, or if upside momentum could return if those fair value assumptions materialize, remains to be seen.

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Alvotech Narrative

If you have a different perspective or want to test your own assumptions, it’s easy to research the data and shape your own thesis in just a few minutes. Do it your way.

A great starting point for your Alvotech research is our analysis highlighting 3 key rewards and 4 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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