Harmony Biosciences Holdings (HRMY) AI Stock Analysis

• Market Cap: $2.28B
• Dividend Yield: N/A
• Average Volume (3M): 841.82K
• Price to Earnings (P/E): 12.8
• Beta (1Y): 1.06
• Revenue Growth: 21.13%
• EPS Growth: 50.86%
• Country: US
• Employees: 268
• Sector: Healthcare
• Sector Strength: 45
• Industry: Biotechnology
• EPS (TTM): 0.87
• Shares Outstanding: 57,596,360
• 10 Day Avg. Volume: 682,050
• 30 Day Avg. Volume: 841,818
• PEG Ratio: 0.75
• Price to Book (P/B): 2.97
• Price to Sales (P/S): 2.74
• P/FCF Ratio: 8.95
• Enterprise Value/Market Cap: 0.51
• Enterprise Value/Revenue: 1.42
• Enterprise Value/Gross Profit: 1.83
• Enterprise Value/Ebitda: 4.41
• 1Y Price Target: $46.00
• Price Target Upside: 13.55% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 10
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 81 Outperform
• Price Target: $41.00 ▲(1.21% Upside)

Harmony Biosciences Holdings scores well due to its strong financial performance and positive earnings call, which highlighted significant revenue growth and a robust pipeline. The technical analysis suggests bullish momentum, although overbought signals could indicate a short-term pullback. The valuation is attractive, with a low P/E ratio suggesting potential undervaluation. The corporate event setback was already factored into the earnings call analysis.

Positive Factors

Revenue Growth

The significant year-over-year revenue growth indicates strong market demand and successful product adoption, supporting long-term business expansion.

Pipeline Advancements

Advancements in the pipeline, including new trials, enhance the company's future growth prospects and potential market leadership in neurological therapies.

Cash Generation

Strong cash generation improves financial flexibility, allowing for strategic investments and resilience against market fluctuations.

Negative Factors

Fragile X Syndrome Study Setback

The setback in the Fragile X syndrome study could delay product development and impact the company's ability to expand its therapeutic offerings.

Increased Operating Expenses

Rising operating expenses may pressure profit margins and require careful management to sustain financial health and growth.

Slowing Revenue Growth Rate

A moderating growth rate could indicate market saturation or increased competition, potentially impacting long-term revenue expansion.

Harmony Biosciences Holdings Business Overview & Revenue Model

Company Description

Harmony Biosciences Holdings, Inc., a commercial-stage pharmaceutical company, develops and commercializes therapies for patients with rare neurological disorders in the United States. Its product, WAKIX is a medication for the treatment of excessive daytime sleepiness in adult patients with narcolepsy. The company was formerly known as Harmony Biosciences II, Inc. and changed its name to Harmony Biosciences Holdings, Inc. in February 2020. Harmony Biosciences Holdings, Inc. was incorporated in 2017 and is based in Plymouth Meeting, Pennsylvania.

How the Company Makes Money

Harmony Biosciences generates revenue primarily through the sale of its pharmaceutical products, particularly its marketed therapies for narcolepsy. The company earns money by selling its drugs through various distribution channels, including pharmacies and healthcare providers. Additionally, Harmony may engage in strategic partnerships with other pharmaceutical companies or healthcare organizations to enhance its product offerings, expand market reach, and facilitate research and development. The success of its revenue model is significantly influenced by the effectiveness of its therapies, the size of the target patient population, pricing strategies, and market access efforts.

Harmony Biosciences Holdings Financial Statement Overview

Summary

Harmony Biosciences Holdings demonstrates strong financial health with robust profitability, efficient operations, and a solid balance sheet. The company has shown consistent revenue growth and improved cash flow metrics, although the pace of growth has moderated. The low leverage and strong equity position provide a stable foundation for future growth, though a more aggressive strategy could potentially accelerate expansion.

Income Statement

Harmony Biosciences Holdings shows strong revenue growth with a TTM increase of 6.92% and consistent profitability, evidenced by a high gross profit margin of 78.34% and a net profit margin of 23.42%. The EBIT and EBITDA margins are also robust at 31.22% and 34.31%, respectively, indicating efficient operations. However, the growth rate has slowed compared to previous years, which may warrant attention.

Balance Sheet

The company's balance sheet is solid with a low debt-to-equity ratio of 0.22, reflecting prudent financial management. The return on equity is strong at 26.32%, showcasing effective use of equity to generate profits. The equity ratio stands at 69.12%, indicating a healthy capital structure. However, the decrease in leverage compared to previous years suggests a more conservative approach, which might limit aggressive expansion.

Cash Flow

Cash flow metrics are positive, with a significant free cash flow growth rate of 14.75% TTM, indicating improved cash generation. The operating cash flow to net income ratio of 1.44 and a free cash flow to net income ratio of 0.99 suggest strong cash conversion efficiency. The company has improved its cash flow position significantly over the years, enhancing financial flexibility.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	825.94M	714.73M	582.02M	437.86M	305.44M	159.74M
Gross Profit	641.74M	557.92M	460.79M	354.37M	249.92M	132.00M
EBITDA	266.02M	233.41M	221.51M	146.87M	80.46M	1.51M
Net Income	185.68M	145.49M	128.85M	181.47M	34.60M	-36.94M
Balance Sheet
Total Assets	1.21B	999.20M	811.45M	673.87M	433.44M	427.07M
Cash, Cash Equivalents and Short-Term Investments	672.58M	467.19M	353.46M	323.12M	234.31M	228.63M
Total Debt	169.73M	181.41M	193.57M	191.65M	195.74M	194.25M
Total Liabilities	373.10M	340.05M	344.46M	271.03M	246.94M	329.89M
Stockholders Equity	835.12M	659.15M	466.99M	402.84M	186.51M	97.18M
Cash Flow
Free Cash Flow	296.89M	218.67M	219.07M	144.29M	98.26M	-4.99M
Operating Cash Flow	297.61M	219.82M	219.39M	144.47M	98.56M	-2.98M
Investing Cash Flow	-29.20M	-67.48M	-46.44M	-141.83M	-100.30M	-2.00M
Financing Cash Flow	-8.78M	-11.00M	-105.55M	6.84M	7.42M	209.16M

Harmony Biosciences Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 40.51
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HRMY, the sentiment is Positive. The current price of 40.51 is above the 20-day moving average (MA) of 36.41, above the 50-day MA of 31.84, and above the 200-day MA of 32.93, indicating a bullish trend. The MACD of 2.20 indicates Negative momentum. The RSI at 80.24 is Negative, neither overbought nor oversold. The STOCH value of 89.64 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HRMY.

Harmony Biosciences Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HRMY	81 Outperform	$2.28B	12.76	25.93%	―	21.13%	50.86%
ARQT	60 Neutral	$3.61B	―	-28.17%	―	129.21%	80.35%
ARDX	55 Neutral	$1.51B	―	-36.18%	―	58.12%	24.08%
IMCR	53 Neutral	$1.81B	―	-7.52%	―	27.51%	38.72%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
ETNB	42 Neutral	―	―	-86.86%	―	―	-82.75%
COGT	37 Underperform	$6.40B	―	-95.40%	―	―	4.32%

Harmony Biosciences Holdings Corporate Events

Harmony Biosciences Phase 3 Study Misses Endpoint

On September 24, 2025, Harmony Biosciences announced that its Phase 3 RECONNECT study of ZYN002 in Fragile X syndrome did not meet its primary endpoint due to a higher than expected placebo response rate. Despite this, the company remains committed to analyzing the data for insights and continuing its development of therapies for rare neurological conditions, with plans to initiate Phase 3 trials for other programs later this year.