Assessing IDEAYA Biosciences (IDYA) Valuation Following Recent Share Price Momentum

IDEAYA Biosciences (IDYA) has been quietly drawing attention from investors, especially as its stock continues to show strong gains over the past few months. Recent returns have outpaced many of its biotech peers, which has sparked interest in what might come next.

See our latest analysis for IDEAYA Biosciences.

After a strong run in recent months, IDEAYA's share price has climbed to $35.88, reflecting a 46% gain over the past 90 days and a 42.6% return year-to-date. This signals growing investor optimism. Looking at a broader timeframe, the stock's three-year total shareholder return of nearly 100% highlights its momentum and presence within the biotech sector.

If you’re curious about what else is performing in the healthcare space, take the next step and explore See the full list for free.

The recent surge raises a key question: given IDEAYA’s rapid climb and ambitious pipeline, is there still room for upside, or has the market already reflected all of its future growth potential in the share price?

Price-to-Sales of 14.6x: Is it justified?

IDYA is currently trading at a price-to-sales ratio of 14.6x, which makes it appear expensive compared to both peers in the US Biotech industry and industry averages.

The price-to-sales ratio evaluates a company’s market value relative to its annual revenues. For emerging biotech businesses like IDEAYA, where profitability is often years away, investors sometimes rely on this metric as a proxy for growth potential.

With a ratio of 14.6x, the market is placing a premium valuation on IDEAYA’s future sales. This figure is higher than the US Biotechs industry average of 13.1x and above the peer average of 11.4x. From a quantitative perspective, the estimated fair price-to-sales ratio for IDEAYA is just 0.9x, a level the market could shift toward if optimism fades.

Explore the SWS fair ratio for IDEAYA Biosciences

Result: Price-to-Sales of 14.6x (OVERVALUED)

However, continued losses and the uncertainty around clinical trial outcomes remain significant risks that could quickly shift market sentiment for IDEAYA Biosciences.

Find out about the key risks to this IDEAYA Biosciences narrative.

Build Your Own IDEAYA Biosciences Narrative

If you want a different perspective or prefer to dig into the numbers yourself, you can easily craft your own view using our quick approach, which takes less than three minutes. Do it your way

A great starting point for your IDEAYA Biosciences research is our analysis highlighting 1 key reward and 2 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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