A Look at Nektar Therapeutics's Valuation Following FDA Fast Track Win for Lead Eczema Drug

Nektar Therapeutics (NKTR) saw its stock draw attention after the company announced that rezpegaldesleukin, its lead drug candidate, received Fast Track Designation from the FDA. This follows encouraging phase 2 results for treating eczema.

See our latest analysis for Nektar Therapeutics.

Nektar’s share price has surged an impressive 294.6% year-to-date and climbed 113.3% over the past three months, as optimism around rezpegaldesleukin’s progress builds. Despite this recent momentum, its 1-year total shareholder return stands at 174.8% and remains deeply negative over five years. This highlights just how volatile and turnaround-driven the story has been.

If Nektar's dramatic rebound has you wondering what other opportunities are out there, explore more healthcare standouts with our See the full list for free.

But with shares already vaulting higher and fresh clinical catalysts on the horizon, investors now face a crucial question: is there still a window for upside, or is the stock’s future potential already reflected in its price?

Most Popular Narrative: 43.8% Undervalued

According to the most popular narrative, Nektar Therapeutics' fair value stands at $101.17, which is substantially above the most recent closing price of $56.89. This sharp valuation divide pivots on the huge commercial opportunity tied to rezpegaldesleukin and its clinical trajectory.

Strong initial Phase IIb and ongoing data for REZPEG in atopic dermatitis, combined with a large and growing addressable market (expected to reach nearly $30B by 2033), position Nektar to access significant new revenue streams and improve long-term earnings as the population ages and chronic inflammatory diseases rise globally. FDA Fast Track designation for REZPEG in both atopic dermatitis and alopecia areata gives Nektar an accelerated regulatory path, potentially reducing time to market and R&D costs, which should improve net margins and cash flow if approvals are achieved ahead of competitors.

Read the complete narrative.

Want a peek behind the curtain at how bullish analysts get to this number? The magic is in big market shifts, aggressive revenue targets, and a future profit turnaround the market isn’t ready for. Find out which assumptions could change everything. Grab the full narrative for the inputs that could justify this premium price.

Result: Fair Value of $101.17 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, Nektar remains highly dependent on rezpegaldesleukin’s success. Setbacks in trials or funding could quickly reverse analyst optimism.

Find out about the key risks to this Nektar Therapeutics narrative.

Another View: Multiples Show a Steep Price

While fair value models point to significant upside, Nektar’s current price-to-sales ratio stands at 14.4x, which is well above peers at 10x and the industry average of 4.4x. The “fair ratio” is estimated at just 6x, suggesting the stock trades with a premium that could carry extra risk. Is this growth story priced to perfection, or is there room for surprise?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Nektar Therapeutics Narrative

If the current perspectives do not quite fit your outlook, you can dive into the data and build a personalized investment narrative in just a few minutes. Do it your way

A great starting point for your Nektar Therapeutics research is our analysis highlighting 3 key rewards and 6 important warning signs that could impact your investment decision.

Looking for More Winning Strategies?

Don't settle for watching from the sidelines. Give your portfolio an edge by targeting unique opportunities that other investors may be overlooking, all curated for you.

• Tap into explosive long-term returns by sifting through these 875 undervalued stocks based on cash flows that the market might be missing right now.
• Capture income and growth by picking from these 18 dividend stocks with yields > 3% with consistent yields above 3% to supplement your portfolio's stability.
• Accelerate your potential gains as innovation sweeps global industries with these 24 AI penny stocks that could redefine tomorrow’s market leaders.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com