Avadel Pharmaceuticals (AVDL) AI Stock Analysis

• Market Cap: $1.85B
• Dividend Yield: N/A
• Average Volume (3M): 3.59M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.08
• Revenue Growth: 79.88%
• EPS Growth: 99.60%
• Country: US
• Employees: 188
• Sector: Healthcare
• Sector Strength: 45
• Industry: Drug Manufacturers - Specialty & Generic
• EPS (TTM): 0.00
• Shares Outstanding: 97,656,660
• 10 Day Avg. Volume: 2,296,651
• 30 Day Avg. Volume: 3,591,858
• PEG Ratio: 0.27
• Price to Book (P/B): 13.54
• Price to Sales (P/S): 5.91
• P/FCF Ratio: -21.32
• Enterprise Value/Market Cap: 0.81
• Enterprise Value/Revenue: 6.00
• Enterprise Value/Gross Profit: 6.36
• Enterprise Value/Ebitda: 147.31
• 1Y Price Target: $19.13
• Price Target Upside: 2.35% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 10
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 61 Neutral
• Price Target: $20.00 ▲(7.01% Upside)

Avadel Pharmaceuticals is on a positive trajectory with strong revenue growth and cash flow improvements. The bullish technical indicators support a positive outlook, although the stock is currently overbought. The earnings call provided a boost with positive guidance and sentiment. However, ongoing profitability challenges and a negative P/E ratio weigh on the overall score.

Positive Factors

Revenue Growth

Strong revenue growth from LUMRYZ indicates successful product adoption and market penetration, supporting long-term financial stability.

Orphan Drug Designation

The Orphan Drug Designation provides market exclusivity and potential pricing power, enhancing competitive advantage in a niche market.

Strategic Acquisition

The acquisition by Alkermes is expected to enhance Avadel's market reach and leverage Alkermes' commercial expertise, boosting long-term growth prospects.

Negative Factors

Profitability Challenges

Ongoing profitability issues may limit reinvestment capabilities and impact long-term financial health, necessitating operational improvements.

Royalty Obligations

Long-term royalty payments to Jazz could constrain profit margins and cash flow, affecting financial flexibility and strategic investments.

Increased Operating Expenses

Rising operating expenses may pressure margins and require careful management to ensure sustainable profitability and growth.

Avadel Pharmaceuticals Business Overview & Revenue Model

Company Description

Avadel Pharmaceuticals (AVDL) is a biopharmaceutical company focused on developing and commercializing innovative therapies to treat various sleep disorders and other conditions. The company operates primarily in the pharmaceutical sector, specializing in the formulation and delivery of medications that enhance patient outcomes. Avadel's core products include its proprietary drug delivery technologies and a portfolio of approved medications aimed at improving sleep quality and managing related health issues.

How the Company Makes Money

Avadel Pharmaceuticals generates revenue primarily through the sale of its pharmaceutical products, including both proprietary and partnered medications. The company earns money from direct sales of its approved drugs, as well as through licensing agreements and collaborations with other pharmaceutical companies. Key revenue streams include royalties from licensed products and potential milestone payments tied to the achievement of specific regulatory or sales targets. Additionally, strategic partnerships with larger pharmaceutical firms can provide financial support and enhance market reach, contributing to overall earnings. Factors such as product efficacy, market demand, and successful commercialization efforts play significant roles in driving the company’s financial performance.

Avadel Pharmaceuticals Financial Statement Overview

Summary

Avadel Pharmaceuticals shows strong revenue growth and cash flow improvements, but struggles with profitability as indicated by negative net margins and returns on equity. The balance sheet is stable with low leverage, providing a solid foundation for future growth.

Income Statement

Avadel Pharmaceuticals has shown a significant improvement in revenue with a 12.41% growth rate in the TTM period. However, the company struggles with profitability, evidenced by a negative net profit margin of -1.32% and a low EBIT margin of 1.93%. The gross profit margin remains strong at 89.64%, indicating efficient cost management. Despite these strengths, the persistent negative net income is a concern.

Balance Sheet

The balance sheet reflects a stable financial position with a low debt-to-equity ratio of 0.03, suggesting minimal leverage. However, the return on equity is negative at -3.73%, indicating inefficiencies in generating returns for shareholders. The equity ratio stands at 49.25%, showing a balanced capital structure but highlighting the need for improved profitability.

Cash Flow

Cash flow analysis reveals a robust free cash flow growth of 552.23% in the TTM period, indicating improved cash generation capabilities. The operating cash flow to net income ratio is 0.10, suggesting that cash flows are not yet fully supporting earnings. The free cash flow to net income ratio is high at 96.68%, reflecting efficient cash conversion despite net losses.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	248.52M	169.12M	27.96M	0.00	0.00	22.33M
Gross Profit	234.76M	153.84M	27.12M	0.00	0.00	16.59M
EBITDA	10.13M	-35.57M	-149.13M	-97.60M	-82.39M	9.60M
Net Income	-278.00K	-48.83M	-160.28M	-137.46M	-77.33M	7.03M
Balance Sheet
Total Assets	199.45M	164.24M	164.70M	132.78M	247.26M	311.64M
Cash, Cash Equivalents and Short-Term Investments	91.58M	73.78M	105.11M	96.50M	157.22M	221.40M
Total Debt	37.38M	1.70M	2.62M	131.02M	145.00M	130.52M
Total Liabilities	101.22M	90.39M	76.96M	153.93M	169.02M	149.37M
Stockholders Equity	98.22M	73.85M	87.74M	-21.14M	78.24M	162.27M
Cash Flow
Free Cash Flow	35.41M	-46.91M	-128.51M	-71.02M	-77.34M	-48.83M
Operating Cash Flow	35.60M	-46.91M	-128.51M	-70.30M	-77.31M	-48.73M
Investing Cash Flow	10.19M	51.78M	-50.09M	79.70M	56.93M	-69.72M
Financing Cash Flow	5.19M	15.97M	135.34M	14.54M	263.00K	179.68M

Avadel Pharmaceuticals Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 18.69
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AVDL, the sentiment is Positive. The current price of 18.69 is above the 20-day moving average (MA) of 17.56, above the 50-day MA of 16.16, and above the 200-day MA of 11.11, indicating a bullish trend. The MACD of 0.98 indicates Negative momentum. The RSI at 73.99 is Negative, neither overbought nor oversold. The STOCH value of 47.21 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AVDL.

Avadel Pharmaceuticals Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AMPH	67 Neutral	$1.13B	9.00	18.32%	―	1.37%	-18.10%
ANIP	62 Neutral	$1.96B	―	-2.82%	―	38.68%	-160.14%
AVDL	61 Neutral	$1.85B	―	-0.32%	―	79.88%	99.60%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
PCRX	46 Neutral	$981.78M	―	-15.57%	―	2.25%	-301.59%
EVO	44 Neutral	$1.19B	―	-17.46%	―	-1.19%	5.06%
HROW	36 Underperform	$1.31B	―	-18.99%	―	47.69%	69.57%

Avadel Pharmaceuticals Corporate Events

Avadel Pharmaceuticals’ Acquisition Strategy Hindered by Restrictive Transaction Agreement

The Transaction Agreement in place for Avadel Pharmaceuticals imposes restrictions that limit the company’s ability to engage with third parties regarding alternative acquisition offers. These provisions may deter potential acquirers from proposing competitive bids, as they could be discouraged by the existing agreement’s terms. Consequently, this could result in a lower acquisition price being offered by potential competitors than might otherwise have been proposed. Such limitations could impact Avadel’s strategic options and shareholder value in the context of acquisition negotiations.

Avadel Pharmaceuticals Acquired by Alkermes for $2.1 Billion

On October 22, 2025, Avadel Pharmaceuticals entered into a transaction agreement with Alkermes, under which Alkermes will acquire Avadel for up to $20.00 per share, valuing the transaction at approximately $2.1 billion. This acquisition, expected to close in the first quarter of 2026, will make Avadel a wholly-owned subsidiary of Alkermes, enhancing Alkermes’ entry into the sleep medicine market and expanding its commercial portfolio with Avadel’s product, LUMRYZ™. The deal is anticipated to be immediately accretive, enhancing Alkermes’ revenue growth and profitability, while leveraging Avadel’s established commercial infrastructure and expertise in rare diseases.

The most recent analyst rating on (AVDL) stock is a Buy with a $16.50 price target. To see the full list of analyst forecasts on Avadel Pharmaceuticals stock, see the AVDL Stock Forecast page.

Avadel Pharmaceuticals Settles Lawsuits with Jazz Pharmaceuticals

On October 21, 2025, Avadel CNS Pharmaceuticals, a subsidiary of Avadel Pharmaceuticals, reached a settlement with Jazz Pharmaceuticals to resolve multiple lawsuits. As part of the agreement, Jazz will pay Avadel $90 million and waive royalties on LUMRYZ sales through September 30, 2025. Both companies will dismiss their lawsuits, and Jazz will grant Avadel a worldwide license for patents related to LUMRYZ. Avadel will pay Jazz royalties on LUMRYZ sales for narcolepsy and other indications. This settlement provides Avadel with long-term clarity on its intellectual property and commercial rights, positioning it to advance its sleep medicines portfolio.

The most recent analyst rating on (AVDL) stock is a Buy with a $16.50 price target. To see the full list of analyst forecasts on Avadel Pharmaceuticals stock, see the AVDL Stock Forecast page.

Avadel Pharmaceuticals Signs Global License Agreement for Sleep Drug

On August 29, 2025, Avadel Pharmaceuticals entered into an exclusive global license agreement with XWPharma Ltd. to develop and commercialize valiloxybate, a GABAB receptor agonist, for sleep disorders such as narcolepsy and idiopathic hypersomnia. This agreement, excluding mainland China, Hong Kong, and Macau, involves a $20 million upfront payment to XWPharma, with potential milestone and royalty payments based on sales achievements. The development of valiloxybate is expected to enhance Avadel’s sleep medicine portfolio and leverage its existing infrastructure for efficient clinical and regulatory advancement.

The most recent analyst rating on (AVDL) stock is a Buy with a $20.00 price target. To see the full list of analyst forecasts on Avadel Pharmaceuticals stock, see the AVDL Stock Forecast page.

Avadel Pharmaceuticals Reports Strong Earnings and Growth

Avadel Pharmaceuticals’ recent earnings call exuded a strong positive sentiment, underscored by impressive growth in patient numbers and revenue. The company celebrated strategic investments in expanding indications and a significant legal triumph. However, the call also acknowledged ongoing legal challenges and a rise in operating expenses, which present potential risks.

Avadel Pharmaceuticals Reports Strong Q2 Growth

Avadel Pharmaceuticals plc is a biopharmaceutical company dedicated to transforming medicines to improve lives, primarily focusing on innovative treatments for sleep disorders, including narcolepsy. In its latest earnings report, Avadel Pharmaceuticals announced a significant 64% increase in net revenue for the second quarter of 2025, driven by the success of its flagship product, LUMRYZ. The company reported a net income of $9.7 million, marking its first profitable quarter since the launch of LUMRYZ in 2023.