Taking Stock of IDEAYA Biosciences (IDYA) Valuation After FDA Clears IDE034 for Phase 1 Trial

IDEAYA Biosciences (IDYA) just picked up fresh momentum after the FDA cleared its IND for IDE034, a first in class bispecific ADC targeting B7H3 and PTK7 in difficult solid tumors.

See our latest analysis for IDEAYA Biosciences.

The IDE034 news lands on a stock that has already been rerating, with an approximate 53 percent 3 month share price return and a 3 year total shareholder return of about 113 percent, suggesting momentum is still building as investors reassess the pipeline after GSK hands back certain assets.

If this kind of oncology story is on your radar, it is also worth exploring other healthcare stocks that could benefit from similar sentiment around clinical progress and de risked pipelines.

With shares already up sharply and trading nearly 40 percent below consensus targets, the real question now is whether IDEAYA is still undervalued on its growing precision oncology platform, or whether the market is already pricing in that future growth.

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

On a price-to-sales basis, IDEAYA looks richly valued, with its 14.6x multiple sitting well above many biotech peers despite the lack of near term profitability.

The price to sales ratio compares the company’s market value to its revenue. It is a common yardstick for early stage biotech companies where earnings are negative and sales are still ramping.

For IDEAYA, such a premium multiple implies investors are paying up today for future pipeline success and high double digit revenue growth. It also means expectations are finely tuned and leaves less room for disappointment as programs progress through the clinic.

That premium is stark when stacked against both the wider US biotech industry, where the average price to sales ratio is 12x, and IDEAYA’s estimated fair price to sales of just 1.3x. This implies the current valuation embeds a far more optimistic trajectory than the level the market could logically settle toward if sentiment cools.

Explore the SWS fair ratio for IDEAYA Biosciences

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

However, setbacks in mid to late stage trials or slower than expected partnering revenue could quickly challenge today’s premium valuation and momentum-driven narrative.

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

Build Your Own IDEAYA Biosciences Narrative

If you see the numbers differently or would rather dig into the details yourself, you can shape a personalized narrative in just 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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