Alkermes (ALKS) AI Stock Analysis

• Market Cap: $5.24B
• Dividend Yield: N/A
• Average Volume (3M): 1.94M
• Price to Earnings (P/E): 15.2
• Beta (1Y): 0.76
• Revenue Growth: -12.31%
• EPS Growth: -17.53%
• Country: US
• Employees: 1,800
• Sector: Healthcare
• Sector Strength: 58
• Industry: Biotechnology
• EPS (TTM): 2.10
• Shares Outstanding: 164,836,230
• 10 Day Avg. Volume: 1,924,456
• 30 Day Avg. Volume: 1,935,252
• PEG Ratio: 3.07
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 0.79
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 3.13
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $39.07
• Price Target Upside: 22.94% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 14

Alkermes' strong financial performance and positive earnings call sentiment are significant strengths, supported by robust profitability and strategic R&D advancements. The technical analysis suggests some caution due to potential overbought conditions. The valuation remains attractive, although the lack of a dividend may deter some investors. Overall, Alkermes presents a compelling growth opportunity, albeit with macroeconomic and market exposure risks.

Positive Factors

Market Opportunity

ALKS is one of the early movers in the narcolepsy treatment market, which is a potential multi-billion dollar category, reflecting a positive outlook for its stock value.

Safety Profile

Analyst believes ALKS-2680 has a clean safety profile, reducing concerns about liver toxicity.

Sales Performance

Lybalvi continued to deliver good performance with sales up 23% year-over-year increase, and the net sales in 1Q were $70M, primarily driven by TRx growth of 22%.

Negative Factors

Competitive Risks

Competitive risks remain given there are two mid-to-late stage orexin competitors and we do not yet have a clear handle on ALKS2680’s safety profile on chronic dosing.

Inventory Levels

The inventory levels have normalized, leading to an expected substantial sequential sales decline in 1Q25.

Sales Guidance

The 2025 top-line guide is slightly lower than consensus estimates, with lighter than expected sales guidance for Aristada and Lybalvi.

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 makes money primarily through the sales and commercialization of its proprietary pharmaceutical products. The company generates revenue from product sales, which include its marketed medications such as Aristada for schizophrenia and Vivitrol for opioid addiction. Additionally, Alkermes earns income from collaborations and partnerships with other pharmaceutical companies, which may involve licensing agreements, milestone payments, and royalties from the commercialization of partnered products. These collaborations allow Alkermes to leverage its formulation and drug delivery technologies while expanding its market reach. Revenue is also derived from research and development services provided to partners, contributing to the company's earnings.

Alkermes Financial Statement Overview

Summary

Alkermes demonstrates strong operational efficiency and financial stability with commendable profitability metrics and a robust balance sheet. Despite recent revenue fluctuations, the company's focus on cash flow management and low leverage risk supports its financial health.

Income Statement

Alkermes shows significant improvement in net profit margin and gross profit margin over the years, with a solid revenue growth rate from 2022 to 2023. The EBIT and EBITDA margins are strong, indicating efficient cost management and operational profitability. However, revenue has declined slightly from 2023 to 2024, which could be a concern if it continues.

Balance Sheet

The balance sheet is robust with a low debt-to-equity ratio, suggesting financial stability and low leverage risk. The return on equity (ROE) is impressive, reflecting effective use of shareholders' equity to generate profits. The equity ratio is healthy, indicating a strong equity base relative to total assets. However, the decline in cash and cash equivalents from 2023 to 2024 should be monitored.

Cash Flow

The company has experienced strong free cash flow growth, particularly from 2022 to 2023. The operating cash flow to net income ratio is favorable, showing efficient cash generation from operations. However, the free cash flow to net income ratio indicates potential volatility, given the fluctuations in free cash flow over the years. Overall, cash flow management appears sound.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
1.56B	1.66B	1.11B	1.17B	1.04B
	Gross Profit
1.31B	1.41B	893.69M	569.84M	465.85M
	EBIT
420.64M	414.12M	-142.26M	-26.66M	-112.43M
	EBITDA
420.64M	519.48M	59.77M	176.40M	-6.02M
	Net Income Common Stockholders
367.07M	355.76M	-158.27M	-48.17M	-110.86M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
751.67M	773.49M	740.08M	765.74M	659.81M
	Total Assets
2.06B	2.14B	1.96B	2.02B	1.95B
	Total Debt
75.54M	372.19M	293.27M	295.80M	274.96M
	Net Debt
-215.61M	-85.28M	797.00K	-41.74M	2.00M
	Total Liabilities
590.59M	933.54M	920.23M	911.90M	882.75M
	Stockholders Equity
1.46B	1.20B	1.04B	1.11B	1.07B
Cash Flow		Free Cash Flow
405.64M	353.31M	-17.21M	72.69M	40.62M
	Operating Cash Flow
439.12M	401.35M	21.04M	101.72M	82.84M
	Investing Cash Flow
-111.31M	53.36M	-64.54M	-66.20M	-11.48M
	Financing Cash Flow
-494.14M	-289.71M	-1.57M	29.07M	-2.17M

Alkermes Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 31.78
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ALKS, the sentiment is Positive. The current price of 31.78 is above the 20-day moving average (MA) of 28.22, above the 50-day MA of 31.76, and above the 200-day MA of 29.50, indicating a bullish trend. The MACD of -0.50 indicates Negative momentum. The RSI at 64.08 is Neutral, neither overbought nor oversold. The STOCH value of 90.37 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ALKS.

Alkermes Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ALKS	77 Outperform	$5.24B	15.15	25.71%	―	-12.31%	-17.53%
KRYS	77 Outperform	$4.80B	55.61	10.34%	―	473.02%	1620.44%
SRPT	66 Neutral	$6.17B	26.34	19.71%	―	52.97%	―
IONS	52 Neutral	$5.05B	―	-118.53%	―	-7.65%	-11.81%
Sector *	52 Neutral	$5.36B	3.88	-42.93%	2.87%	17.85%	1.45%
AXSM	50 Neutral	$5.52B	―	-231.63%	―	42.53%	-15.29%
BPMC	48 Neutral	$5.17B	―	-47.71%	―	99.19%	48.43%

Alkermes Corporate Events

Alkermes Advances Orexin Program with ALKS 2680 Candidate

Alkermes announced significant advancements in its orexin agonist program, particularly with its ALKS 2680 candidate, expected to provide pivotal data in 2025. The company, boasting a strong financial position with over $1 billion in expected product sales, sees substantial opportunities for value creation as it leads in innovative treatments for hypersomnolence disorders, potentially reshaping the market with its upcoming studies and regulatory strategies.