Does Amneal Pharmaceuticals Still Offer Value After 36% Surge and New Product Approvals in 2025?

If you have ever wondered whether Amneal Pharmaceuticals deserves a spot in your portfolio, you are definitely not alone. With shares closing recently at $10.55 and sky-high returns, up 6.9% just this past week and 36.0% since the start of the year, it is natural to question if the growth story still has legs or if the best days are behind. For the more patient investors, the five-year return of 119.3% and a jaw-dropping 419.7% gain over three years certainly grab attention. When a stock posts these kinds of numbers, it usually signals shifting market sentiment, sometimes optimism about the company’s prospects and other times a recalibration of perceived risks throughout the sector.

Digging deeper, Amneal recently scored a 5 out of 6 on our valuation checks, meaning it appears undervalued across almost every metric we look at. That is a rare feat, and it could mean the growth we have seen so far is justified, or maybe that there is still room to run. Of course, valuation is never just a single number, and there is more than one way to see if a company is truly trading at a bargain. Let’s break down the different approaches to valuation and see what each one says about Amneal Pharmaceuticals. We will then wrap up with what might just be the most telling measure of all.

Amneal Pharmaceuticals delivered 24.7% returns over the last year. See how this stacks up to the rest of the Pharmaceuticals industry.

Approach 1: Amneal Pharmaceuticals Discounted Cash Flow (DCF) Analysis

The Discounted Cash Flow (DCF) model is a popular way to estimate a company’s intrinsic value by projecting its future cash flows and then discounting these amounts back to today, to account for the time value of money. This approach answers the core question: what are all future cash flows really worth, in today’s dollars?

For Amneal Pharmaceuticals, the latest reported Free Cash Flow stands at $258.94 million. Over the next several years, analysts forecast rapid growth, with FCF expected to reach $503 million by 2027. Simply Wall St then extrapolates these numbers beyond the analyst horizon, with ten-year projections climbing as high as $991.90 million by 2035. All projections are provided in US Dollars.

Using these projections, the DCF analysis arrives at an estimated fair value of $61.17 per share. Compared to the recent share price of $10.55, this suggests that the stock trades at an 82.8% discount relative to its intrinsic worth based on projected future cash flows.

Result: UNDERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Amneal Pharmaceuticals.

Our Discounted Cash Flow (DCF) analysis suggests Amneal Pharmaceuticals is undervalued by 82.8%. Track this in your watchlist or portfolio, or discover more undervalued stocks.

Approach 2: Amneal Pharmaceuticals Price vs Sales

The Price-to-Sales (P/S) multiple is a common and practical tool for valuing companies, especially when profits may be temporarily uneven or reinvested for growth. For pharmaceutical firms like Amneal, which often experience fluctuating earnings due to research and development cycles, the P/S ratio helps investors gauge value independently of short-term profitability by focusing on revenue generation.

Typically, a "fair" P/S ratio is shaped by a company’s growth prospects, profit margins, market position, and underlying risk. If investors expect higher growth and consistent execution, a company can justify a higher multiple. Firms with more uncertainty or slower growth see lower “normal” levels.

Currently, Amneal Pharmaceuticals trades at a 1.16x P/S ratio. This is lower than both its peer average of 1.53x and the broader industry’s average of 4.99x, highlighting a discount on this metric. However, Simply Wall St takes the analysis further with the Fair Ratio, a proprietary calculation that reflects not just peer or industry comparisons but also accounts for Amneal’s growth outlook, risks, profitability, and market size. For Amneal, the Fair Ratio is 2.75x, which suggests that the current P/S is meaningfully below the level warranted by its fundamentals.

Since Amneal’s actual P/S is well below its Fair Ratio, this signals the stock is undervalued on a sales basis, even before considering potential future growth and margin improvements.

Result: UNDERVALUED

PS ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Amneal Pharmaceuticals Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives. A Narrative is more than just a number; it is your own story and perspective about a company, where you connect what you believe about its future to your assumptions for revenue, earnings, margins, and ultimately, a fair value.

With Narratives, you are able to tie together Amneal Pharmaceuticals’ business trends and strategy with a financial forecast, and see clearly what that means for your assessment of fair value. This approach moves beyond static ratios or analyst targets and lets you visualize the link between your outlook and the company’s valuation, making investing decisions feel more natural and grounded in your own thinking.

Accessible directly on Simply Wall St’s Community page, a resource trusted by millions of investors, Narratives are easy to try, and they update dynamically any time major news or earnings are reported. By comparing your Narrative fair value to the latest share price, it becomes much easier to decide when you might want to buy or sell, based on changes that matter to you.

For example, community Narratives for Amneal Pharmaceuticals currently range from a more cautious outlook, assigning a fair value of $12.00, up to a highly optimistic view with a fair value at $12.67, illustrating how different assumptions can lead to a range of personal valuations.

Do you think there's more to the story for Amneal Pharmaceuticals? Create your own Narrative to let the Community know!

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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