Does The Market Misprice BioMarin After 2025 DCF And Earnings Multiple Signals?

• If you have been wondering whether BioMarin Pharmaceutical is starting to look like a bargain or still a value trap, you are not alone. This article will walk through the key numbers that matter.
• The stock has slipped 1.0% over the last week, is up a modest 2.0% over 30 days, but is still down 19.2% year to date and 18.5% over the last year, with longer-term 3 year and 5 year returns of minus 50.4% and 39.8%. These figures have left many investors questioning what the market is really pricing in.
• Recent headlines have focused on BioMarin’s evolving rare disease pipeline and regulatory milestones, alongside ongoing debates about pricing power and competition in key therapies. Together, these updates have stirred fresh discussion about whether the current share price properly reflects the company’s long-term growth runway and risk profile.
• On our framework, BioMarin scores a 4/6 valuation score, indicating it screens as undervalued on most of the checks we run. We will break down what that means across different valuation approaches before circling back at the end to an even better way to think about what the stock is truly worth.

Find out why BioMarin Pharmaceutical's -18.5% return over the last year is lagging behind its peers.

Approach 1: BioMarin Pharmaceutical Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow model estimates what a company is worth today by projecting the cash it can generate in the future and discounting those cash flows back to the present.

For BioMarin Pharmaceutical, the latest twelve month Free Cash Flow is about $797.9 million. Analysts provide detailed forecasts for the next few years, and Simply Wall St then extends those trends further out, using a 2 Stage Free Cash Flow to Equity approach to estimate how cash generation could evolve over the next decade.

Under this framework, BioMarin's annual Free Cash Flow is projected to rise to around $1.43 billion by 2035, reflecting steady growth in the underlying business. When all those future cash flows are discounted back to today, the model arrives at an estimated intrinsic value of roughly $142.67 per share.

Compared with the current market price, this implies the stock is about 62.3% undervalued based purely on the DCF view, suggesting investors are not fully pricing in BioMarin's future cash generation potential.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests BioMarin Pharmaceutical is undervalued by 62.3%. Track this in your watchlist or portfolio, or discover 900 more undervalued stocks based on cash flows.

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

Approach 2: BioMarin Pharmaceutical Price vs Earnings

For profitable companies like BioMarin Pharmaceutical, the Price to Earnings (PE) ratio is a straightforward way to gauge how much investors are willing to pay today for each dollar of current earnings. In general, higher growth expectations and lower perceived risk justify a higher, or more expensive, PE multiple, while slower growth or greater uncertainty usually warrants a lower one.

BioMarin currently trades on a PE of about 19.8x, broadly in line with both the Biotechs industry average of roughly 19.1x and its immediate peer group at around 20.2x. That might suggest the stock is fairly typical for the sector at first glance. However, Simply Wall St also calculates a proprietary “Fair Ratio” of 23.8x for BioMarin, which reflects what its PE should be when factoring in its specific earnings growth outlook, profitability, size, industry positioning and risk profile.

This Fair Ratio approach is more tailored than simply comparing with peers because it adjusts for BioMarin’s own fundamentals rather than assuming that all biotech names deserve the same multiple. With the current PE of 19.8x sitting below the Fair Ratio of 23.8x, the multiple-based view points to the shares trading at a discount.

Result: UNDERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1450 companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your BioMarin Pharmaceutical Narrative

Earlier we mentioned that there is an even better way to understand valuation. Let us introduce you to Narratives, which are simple, story driven views of a company that connect your assumptions about future revenue, earnings and margins to a fair value estimate. They then compare that fair value with today’s share price to help you decide when to buy or sell, all within an easy to use tool on Simply Wall St’s Community page that millions of investors already use. Narratives update automatically as new news or earnings arrive so your view stays current, and they allow different investors to hold very different yet structured perspectives on BioMarin Pharmaceutical. For example, one Narrative might expect faster adoption of VOXZOGO, improving margins and assign a fair value closer to the most bullish analyst target of about $122 per share. A more cautious Narrative might emphasize pricing pressure and competitive risks and land nearer the most bearish target around $60 per share. The platform makes these story linked forecasts transparent so you can choose the Narrative that best fits your understanding of the business and your risk tolerance.

Do you think there's more to the story for BioMarin Pharmaceutical? Head over to our Community to see what others are saying!

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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