Alkermes (ALKS) AI Stock Analysis

• Market Cap: $5.04B
• Dividend Yield: N/A
• Average Volume (3M): 1.92M
• Price to Earnings (P/E): 21.1
• Beta (1Y): 0.76
• Revenue Growth: 1.08%
• EPS Growth: 3.40%
• Country: US
• Employees: 1,800
• Sector: Healthcare
• Sector Strength: 45
• Industry: Biotechnology
• EPS (TTM): 0.29
• Shares Outstanding: 166,649,930
• 10 Day Avg. Volume: 1,999,051
• 30 Day Avg. Volume: 1,918,388
• PEG Ratio: -0.56
• Price to Book (P/B): 2.53
• Price to Sales (P/S): 3.12
• P/FCF Ratio: 8.85K
• Enterprise Value/Market Cap: 0.89
• Enterprise Value/Revenue: 3.03
• Enterprise Value/Gross Profit: 3.51
• Enterprise Value/Ebitda: 13.52
• 1Y Price Target: $44.30
• Price Target Upside: 46.45% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 11
• EPS Forecast (FY): -0.19
• Revenue Forecast (FY): $1.79B

• Rating: 66 Neutral
• Price Target: $34.00 ▲(12.40% Upside)
• Action: Reiterated Date: 02/26/26
• Date: Action: Reiterated 02/26/26

The score is driven by a strong balance sheet and solid profitability, plus constructive 2026 outlook and strategy from the latest earnings call. It is tempered by the sharp drop in TTM cash generation and weak near-term technicals, with valuation appearing only moderate and no dividend support.

Positive Factors

Balance-sheet strength

Very low leverage and accumulated equity give Alkermes durable financial flexibility to fund R&D, integrate acquisitions, and absorb payer or product setbacks. A strong balance sheet supports multi-year investment in pipeline and commercialization without forced asset sales or abrupt cost cuts.

High margins and profitability

Elevated gross and net margins reflect advantaged unit economics from proprietary products and manufacturing. Sustained profitability provides internal funding for clinical programs and commercialization, improving resilience through clinical cycles and enabling reinvestment into high-return projects.

Pipeline and strategic expansion

Breakthrough designation and planned Phase 3 position Alkermes to enter a large sleep-disorder market. Combined with the Avadel/LUMRIZE acquisition, this creates a durable commercial and R&D platform that diversifies revenue and, if trials succeed, could establish leadership in orexin-based therapies.

Negative Factors

Weak cash generation

A sharp TTM drop in operating and free cash flow to near break-even weakens earnings quality and the firm's ability to self-fund clinical and commercial investments. Persistent cash volatility or working-capital swings could force external financing or constrain discretionary spending during integration.

Acquisition-driven leverage

The sizeable term loan and cash outlay materially raise interest exposure and repayment obligations. Elevated financing cost (guidance shows $75–85M net interest) reduces free cash available for R&D or buybacks and increases downside sensitivity if commercial performance or synergies lag expectations.

Higher operating costs and GAAP loss

Aggressive near-term R&D and SG&A to fund Phase 3 and integration, combined with acquisition accounting, produce a GAAP loss for 2026. Even if partially non-cash, higher expenses pressure reported profitability and could limit optionality on further investments until cash generation normalizes.

Alkermes Business Overview & Revenue Model

Company Description

Alkermes plc, a biopharmaceutical company, researches, develops, and commercializes pharmaceutical products to address unmet medical needs of patients in various therapeutic areas in the United States, Ireland, and internationally. Its marketed products include ARISTADA, an intramuscular injectable suspension for the treatment of schizophrenia; VIVITROL for the treatment of alcohol and prevention of opioid dependence; RISPERDAL CONSTA for the treatment of schizophrenia and bipolar I disorder; INVEGA SUSTENNA for the treatment of schizophrenia and schizoaffective disorder; XEPLION, INVEGA TRINZA, and TREVICTA to treat schizophrenia and schizoaffective; and VUMERITY for the treatment of relapsing forms of multiple sclerosis in adults, including clinically isolated syndrome, relapsing-remitting and active secondary progressive diseases. The company is also developing LYBALVI, an oral atypical antipsychotic drug candidate for the treatment of adults with schizophrenia and bipolar I disorder; and nemvaleukin alfa, an engineered fusion protein to expand tumor-killing immune cells and to avoid the activation of immunosuppressive cells. It has collaboration agreements primarily with Janssen Pharmaceutica N.V., Janssen Pharmaceutica Inc, and Janssen Pharmaceutica International. Alkermes plc was founded in 1987 and is headquartered in Dublin, Ireland.

How the Company Makes Money

Alkermes generates revenue primarily through the sale of its proprietary pharmaceutical products, including Vivitrol and Aristada. The company also earns income from royalties on products developed through its proprietary technologies, as well as through collaborations and partnerships with other pharmaceutical companies. Significant partnerships, such as those with larger pharmaceutical firms, enhance its research and development capabilities and provide additional revenue streams. Alkermes also engages in licensing agreements that may contribute to its earnings, allowing it to leverage its drug development expertise while minimizing risk.

Alkermes Financial Statement Overview

Summary

Strong profitability (TTM gross margin ~86%, net margin ~22%) and a very strong, low-leverage balance sheet (debt-to-equity ~0.04; ROE ~21%) support the score. It is held back by modestly negative recent revenue trend (TTM revenue ~-3%) and a sharp deterioration in TTM operating/free cash flow to near break-even, which raises near-term quality-of-earnings and cash conversion concerns.

Income Statement

Profitability has improved meaningfully versus earlier years, with strong margins in TTM (Trailing-Twelve-Months) (gross margin ~86% and net margin ~22%). However, growth has turned modestly negative recently (TTM revenue down ~3% after a slight decline in 2024), and earnings are off their 2023–2024 highs despite staying solidly profitable.

Balance Sheet

The balance sheet is a clear strength: leverage is very low in TTM (Trailing-Twelve-Months) (debt-to-equity ~0.04) and equity has built over time, supporting financial flexibility. Returns on equity remain healthy (~21% TTM), though down from the peak levels seen in 2023–2024.

Cash Flow

Cash generation is the key concern. After strong operating and free cash flow in 2023–2024, TTM (Trailing-Twelve-Months) operating cash flow and free cash flow fell to near break-even (both ~$0.5M) with a sharp decline in free cash flow growth. While free cash flow still roughly tracks reported earnings in TTM, the sudden cash flow drop raises questions around working-capital swings or timing effects.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.48B	1.56B	1.66B	1.11B	1.17B
Gross Profit	1.27B	1.31B	1.41B	893.73M	976.43M
EBITDA	330.89M	494.86M	519.48M	59.77M	177.60M
Net Income	241.66M	367.07M	355.76M	-158.27M	-48.17M
Balance Sheet
Total Assets	2.49B	2.06B	2.14B	1.96B	2.02B
Cash, Cash Equivalents and Short-Term Investments	588.36M	751.67M	773.49M	608.47M	536.31M
Total Debt	70.00M	75.54M	372.19M	379.44M	416.21M
Total Liabilities	667.70M	590.59M	933.54M	920.23M	911.90M
Stockholders Equity	1.82B	1.46B	1.20B	1.04B	1.11B
Cash Flow
Free Cash Flow	520.80K	405.64M	353.31M	-17.21M	72.69M
Operating Cash Flow	520.80K	439.12M	401.35M	21.04M	101.72M
Investing Cash Flow	295.50K	-111.31M	53.36M	-64.54M	-66.20M
Financing Cash Flow	12.40K	-494.14M	-289.71M	-1.57M	29.07M

Alkermes Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 30.25
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ALKS, the sentiment is Negative. The current price of 30.25 is below the 20-day moving average (MA) of 32.97, below the 50-day MA of 31.40, and above the 200-day MA of 29.89, indicating a neutral trend. The MACD of -0.41 indicates Positive momentum. The RSI at 37.78 is Neutral, neither overbought nor oversold. The STOCH value of 17.22 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ALKS.

Alkermes Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
KRYS	81 Outperform	$7.57B	37.81	18.91%	―	54.51%	275.94%
ALKS	66 Neutral	$5.04B	21.12	14.72%	―	1.08%	3.40%
PTCT	65 Neutral	$5.49B	8.58	―	―	97.54%	―
TGTX	61 Neutral	$4.69B	10.59	102.75%	―	100.88%	―
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
CRSP	47 Neutral	$5.83B	―	-30.18%	―	-81.10%	-99.21%

Alkermes Corporate Events

Alkermes Announces CEO Succession and Leadership Transition Plan

Alkermes plc announced on Feb. 25, 2026 that long-serving Chief Executive Officer Richard Pops will retire from the CEO role on July 31, 2026 after 35 years at the helm, while remaining non-executive chairman and senior advisor through year-end to provide continuity. The board has appointed current Executive Vice President and Chief Operating Officer Blair Jackson, a 25-year company veteran with broad scientific and operational experience, to succeed him as CEO effective Aug. 1, 2026, in a planned succession that aims to maintain strategic momentum in neuroscience, particularly in sleep medicine and orexin-based therapies, following the recent Avadel acquisition.

Pops’ transition is structured with detailed compensation and equity-vesting terms designed to retain his guidance during the handover and beyond his board tenure, underscoring the board’s emphasis on stability during a pivotal growth phase for the company. Jackson’s elevation, following his key role in recent portfolio reshaping and transactions, signals continuity in Alkermes’ strategy to build on its commercial base in serious mental illness and addiction while accelerating its expansion into narcolepsy and related central nervous system disorders, a direction closely watched by investors and partners.

The most recent analyst rating on (ALKS) stock is a Buy with a $45.00 price target. To see the full list of analyst forecasts on Alkermes stock, see the ALKS Stock Forecast page.

Alkermes Completes Avadel Acquisition, Expands Sleep Medicine Portfolio

On Feb. 12, 2026, Alkermes completed its all-cash acquisition of Avadel Pharmaceuticals via an Irish court-approved scheme of arrangement, making Avadel a wholly owned subsidiary. The deal adds FDA‑approved LUMRYZ, an extended‑release sodium oxybate for narcolepsy, as well as early-stage candidate valiloxybate, and transfers Avadel’s commercial infrastructure and sleep-medicine expertise to Alkermes.

To fund the acquisition, Alkermes used about $750 million in cash and drew $1.525 billion under new senior secured term loan A and B facilities maturing in 2031, terminating a prior bridge facility, and expects to pay down the debt with business cash flows. The company projects the transaction will be accretive in 2026, enhances its revenue growth profile, accelerates its entry into the sleep medicine and rare-disease markets, and triggers significant 2026 transaction-related costs, inventory step-up, IP amortization and higher net interest expense while Avadel’s shares are delisted and deregistered from Nasdaq.

The most recent analyst rating on (ALKS) stock is a Buy with a $58.00 price target. To see the full list of analyst forecasts on Alkermes stock, see the ALKS Stock Forecast page.

Alkermes plans Avadel acquisition to expand sleep portfolio

In 2025, Alkermes generated more than $1.45 billion in commercial revenues with strong cash flow and profitability and laid out a 2026 plan centered on driving growth in neuroscience and leading innovation in orexin 2 receptor agonists for sleep disorders. The company reported positive multi-week phase 2 Vibrance data in 2025 for its orexin 2 receptor agonist alixorexton in both narcolepsy type 1 and type 2, showing statistically significant and clinically meaningful improvements in wakefulness, excessive daytime sleepiness, cataplexy, fatigue and cognition with a favorable safety profile, leading to an FDA Breakthrough Therapy designation in narcolepsy type 1 and supporting the launch of a registrational phase 3 narcolepsy program in the first quarter of 2026. Management positions orexin 2 receptor agonists as a multi‑billion‑dollar opportunity, estimating a market of more than $10 billion across narcolepsy and idiopathic hypersomnia, underpinned by a large base of undertreated patients and an existing oxybate market exceeding $1.8 billion in 2024 revenues. The planned acquisition of Avadel in 2026, together with ongoing phase 2 work in idiopathic hypersomnia and anticipated phase 3 data for LUMRYZ in that indication, is designed to accelerate Alkermes’ entry into the commercial sleep medicine market, augment its revenue growth and profitability profile, and establish the company as a leader in a new therapeutic category within central disorders of hypersomnolence.

The most recent analyst rating on (ALKS) stock is a Buy with a $31.00 price target. To see the full list of analyst forecasts on Alkermes stock, see the ALKS Stock Forecast page.

Alkermes Gains FDA Breakthrough Status for Narcolepsy Drug

On January 6, 2026, Alkermes announced that the U.S. Food and Drug Administration granted Breakthrough Therapy designation to alixorexton, its oral, selective orexin 2 receptor agonist, for the treatment of narcolepsy type 1, following encouraging phase 1 and phase 2 data, including positive results from the 92-patient Vibrance-1 study. In that phase 2 trial, alixorexton met its primary endpoint at all tested doses, showing statistically significant, clinically meaningful and dose-dependent improvements in wakefulness versus placebo on the Maintenance of Wakefulness Test, and was generally well tolerated, prompting Alkermes to plan initiation of a global phase 3 program for narcolepsy in the first quarter of 2026, a move that could strengthen its position in sleep-disorder therapeutics and potentially establish alixorexton as a new standard of care in narcolepsy type 1 if late-stage data and regulatory review are favorable.

The most recent analyst rating on (ALKS) stock is a Buy with a $37.00 price target. To see the full list of analyst forecasts on Alkermes stock, see the ALKS Stock Forecast page.