Nektar Therapeutics (NKTR) has seen its stock rise slightly in the past day and make meaningful gains over the past three months. Investors might be taking note as shares have nearly doubled in that period, which may suggest renewed market interest.
Momentum has picked up for Nektar Therapeutics after a strong 90-day share price return of 149%, bringing this year’s total share price gain to over 288%. While the latest move follows some short-term swings, the bigger picture is a remarkable turnaround. However, long-term total returns remain negative for now.
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But after such dramatic gains, is Nektar’s current valuation justified by improving fundamentals or has the recent surge already accounted for future growth? This leaves investors to wonder if a true buying opportunity remains.
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Most Popular Narrative: 40% Undervalued
With Nektar stock last closing at $55.97 and the most widely followed narrative putting fair value at $93.86, there is potential for a valuation reset as optimism builds around its upcoming milestones.
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.
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However, persistent net losses and reliance on REZPEG's regulatory and commercial success could quickly shift sentiment if development or fundraising encounters setbacks.
While analyst optimism paints Nektar as undervalued, a look at its current price-to-sales ratio tells a different story. At 17x, it far exceeds the US Pharmaceuticals industry average of 4x, its peer average of 10.4x, and even the fair ratio of 8.8x. This pricing gap signals that the market may have already priced in a lot of future hope. For new buyers, this could increase the risk if expectations fall short.
If you see things differently or want to dig deeper into the numbers, you can easily build your own viewpoint in just a few minutes. Do it your way
A great starting point for your Nektar Therapeutics research is our analysis highlighting 2 key rewards and 4 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.
Valuation is complex, but we're here to simplify it.
Discover if Nektar Therapeutics might be undervalued or overvalued with our detailed analysis, featuring fair value estimates, potential risks, dividends, insider trades, and its financial condition.
A biopharmaceutical company, focuses on discovering and developing therapies that selectively modulate the immune system to treat autoimmune disorders in the United States and internationally.
