Assessing Ionis Pharmaceuticals After Positive Clinical Trial News and a 112% Rally in 2025

If you’re standing at the crossroads of whether to jump into Ionis Pharmaceuticals stock, you’re not alone. Investors are weighing their options after a period of impressive gains, with Ionis closing at $73.57 and returning 14.8% over the past 30 days alone. Even more eye-catching is that the stock is up a remarkable 112.1% year to date and 85.3% over the last 12 months. Clearly, something has changed in how the market values Ionis. This could be due to a shift in sentiment, a new risk assessment, or simply growing confidence in the company’s biotech pipeline.

Recent news has definitely played a role in fueling these moves. Among the highlights, Ionis announced positive clinical trial results for a flagship drug candidate and signed a promising partnership with a major pharmaceutical player. These milestones have investors reconsidering the company’s long-term potential, and it is reflected in the surge in share price and trading volumes.

But is the stock overvalued, fairly priced, or still flying under the radar? Based on six core valuation checks, Ionis currently scores a 2, meaning it is undervalued on two out of six measures. That is a mixed first impression, neither a slam dunk nor a red flag. To get a clearer picture, let us dig deeper into what these valuation checks really reveal. Even as the numbers are broken down, it can be helpful to consider a broader perspective on valuation that goes beyond the usual formulas.

Ionis Pharmaceuticals scores just 2/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

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

The Discounted Cash Flow (DCF) model estimates what a company is really worth by projecting its future cash flows and discounting them back to today's dollars. This approach helps investors gauge whether the current share price reflects true long-term value.

For Ionis Pharmaceuticals, the DCF uses a 2 Stage Free Cash Flow to Equity model. Right now, the company’s latest twelve-month Free Cash Flow stands at around -$277 million, which means it is still in the investment phase. However, according to analyst estimates and subsequent projections, cash flow is expected to see significant improvement. By 2029, projections place Free Cash Flow at $326 million and by 2035, estimates reach nearly $1.7 billion. These projections are based primarily on analyst input for the next five years, with further years estimated using industry growth rates.

Based on these forecasts, the DCF model calculates Ionis Pharmaceuticals’ intrinsic value at $156.43 per share. With the current share price at $73.57, the stock is trading at a 53.0% discount to its calculated fair value. This suggests the market is significantly undervaluing Ionis’ growth potential.

Result: UNDERVALUED

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

Our Discounted Cash Flow (DCF) analysis suggests Ionis Pharmaceuticals is undervalued by 53.0%. Track this in your watchlist or portfolio, or discover more undervalued stocks.

Approach 2: Ionis Pharmaceuticals Price vs Sales

The Price-to-Sales (P/S) ratio is often used to value biotech companies like Ionis Pharmaceuticals, especially when profits are limited but sales are building rapidly. While price-to-earnings ratios are popular for established, profitable companies, the P/S ratio can offer a more meaningful benchmark for businesses that are investing heavily in future growth and have yet to generate consistent earnings.

Growth prospects and perceived risk have a big impact on what a “normal” or “fair” P/S ratio should be. Companies with higher growth potential or lower risk tend to justify higher multiples. Those facing uncertainties or slower growth usually trade at lower ratios.

Currently, Ionis Pharmaceuticals trades at a 12.42x P/S ratio. To put this in perspective, this is just above the biotech industry average of 11.30x and is higher than the peer group average of 7.06x.

Simply Wall St also provides a “Fair Ratio” for the preferred multiple, which adjusts for not only industry and peer comparisons, but also the company’s expected earnings growth, profit margins, risks, and its market capitalization. For Ionis, the Fair Ratio stands at 3.77x. This approach goes deeper than simple averages and aims to reflect the true risk-return profile of the business.

Comparing the actual P/S ratio of 12.42x to the Fair Ratio of 3.77x, Ionis appears to be trading at a substantial premium to its risk-adjusted fair value based on current fundamentals.

Result: OVERVALUED

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 Ionis Pharmaceuticals Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives. Narratives are a simple but powerful investment tool that allows you to see the story behind the numbers. They connect a company’s business outlook and milestones (your perspective) to a clear financial forecast and a calculated fair value.

This approach is easy to grasp and available to everyone in the Community section of Simply Wall St, where millions of investors share and compare their Narratives. Instead of relying on static metrics, Narratives make it possible to continuously update your investment view as new information, like news or earnings, comes out. This way, your insights evolve alongside the company.

With Narratives, you can compare your fair value with the current share price to decide when to buy or sell, all while tracking how different scenarios play out. For instance, for Ionis Pharmaceuticals, some investors believe aggressive expansion and regulatory wins point to a $96 fair value, while others focus on commercialization risks and competition, suggesting a fair value nearer to $43.

Narratives help you connect your understanding of Ionis’s story to a real-time, actionable valuation. This provides a smarter, more dynamic way to make investment decisions.

Do you think there's more to the story for Ionis 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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