Amgen (AMGN) just caught the market’s eye with a key regulatory win. The FDA expanded the approved use of Amgen’s blockbuster drug Repatha, opening access to adults at risk for major adverse cardiovascular events, even those who haven’t been diagnosed with cardiovascular disease. Alongside this, the agency reinforced Repatha’s use for a rare genetic cholesterol disorder and underlined the importance of pairing it with diet and exercise. The headline here is simple: Amgen’s addressable market for Repatha just received a major boost, prompting investors to reconsider what future growth might look like.
This news comes as Amgen’s stock performance has been a tug of war. Shares are up over 10% year to date, but still down 11% over the past year, suggesting recent momentum may be building after a stretch of investor caution. Just last month, Amgen closed its acquisition of rare disease therapeutics maker Horizon. With annual net income up more than 10%, the company is beginning to show renewed confidence.
With shares now reacting to Repatha’s expanded market, the key question is whether there is room for the stock to advance further or if the market already reflects the potential of this new growth driver.
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Most Popular Narrative: 7.8% Undervalued
According to community narrative, Amgen is currently priced below its estimated fair value, suggesting a potentially attractive entry point for investors focused on future growth catalysts.
Advancements in personalized and targeted therapies, reflected in the robust late-stage pipeline (for example, MariTide for obesity and type 2 diabetes, Repatha and olpasiran for cardiovascular indications, and multiple bispecific T-cell engagers for oncology), position Amgen to launch high-margin, first-in-class products. These products could drive both top-line growth and margin expansion in the coming years.
Curious how analysts justify Amgen’s higher fair value? Their forecast relies on a bold combination of future earnings growth, improved margins, and a notably ambitious profit multiple. Want to see which aggressive assumptions set this target apart from the rest? The full narrative explains the numbers behind the valuation.
While community and analyst fair value estimates suggest Amgen is undervalued, our SWS DCF model indicates an even larger gap between price and fair value. Do fundamentals show untapped potential, or is there something investors are missing?
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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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Kshitija (or Keisha) Bhandaru is an Equity Analyst at Simply Wall St and has over 6 years of experience in the finance industry and describes herself as a lifelong learner driven by her intellectual curiosity. She previously worked with Market Realist for 5 years as an Equity Analyst.
