Innoviva (INVA) AI Stock Analysis

• Market Cap: $1.70B
• Dividend Yield: N/A
• Average Volume (3M): 731.52K
• Price to Earnings (P/E): 7.5
• Beta (1Y): 0.20
• Revenue Growth: 9.76%
• EPS Growth: 88.06%
• Country: US
• Employees: 127
• Sector: Healthcare
• Sector Strength: 45
• Industry: Biotechnology
• EPS (TTM): 1.94
• Shares Outstanding: 74,073,650
• 10 Day Avg. Volume: 728,112
• 30 Day Avg. Volume: 731,516
• PEG Ratio: <0.01
• Price to Book (P/B): 1.15
• Price to Sales (P/S): 3.17
• P/FCF Ratio: 6.88
• Enterprise Value/Market Cap: 0.54
• Enterprise Value/Revenue: 2.23
• Enterprise Value/Gross Profit: 2.83
• Enterprise Value/Ebitda: 2.48
• 1Y Price Target: $37.00
• Price Target Upside: 61.15% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4
• EPS Forecast (FY): 1.99
• Revenue Forecast (FY): $434.24M

• Rating: 74 Outperform
• Price Target: $27.00 ▲(17.60% Upside)
• Action: Upgraded Date: 02/26/26
• Date: Action: Upgraded 02/26/26

Score is driven primarily by strong financial performance, highlighted by high profitability, solid cash generation, and a materially de-risked balance sheet (debt reported at $0). The main offset is technical stretch (overbought indicators) and only moderate valuation support (P/E ~17.4; no dividend yield provided).

Positive Factors

High profitability and cash generation

Sustained high gross and net margins alongside strong operating and free cash flow indicate the business converts revenue to cash efficiently. That durable cash generation supports reinvestment, payouts, and M&A flexibility over the next several quarters.

De-levered balance sheet

Eliminating debt materially reduces financial risk and preserves optionality. A zero-debt position with sizable equity provides capacity for opportunistic acquisitions, continued product launches, or capital returns without near-term refinancing pressure.

Expanding commercial portfolio

New approvals and product launches broaden revenue sources beyond legacy royalties, building a direct commercial franchise. Growing IST product sales and successful launches create structural upside and diversify cash flows away from a single partner relationship.

Negative Factors

Volatile margins and earnings

Material year-to-year swings in margins and net income complicate forecasting and capital allocation. Persistent volatility can undermine investor confidence and makes sustaining investment or dividend policies more difficult over the medium term.

Concentration on partner royalties

A business model heavily weighted to royalties from a single major partner limits control over core cash flows. Product lifecycle, partner pricing, or commercial decisions at GSK can materially affect revenues beyond Innoviva’s direct influence.

Variable free cash flow growth

Although absolute FCF is strong, the recent sharp slowdown in FCF growth signals operational or timing variability. If this variability persists, it could constrain sustained buybacks, investments, or funding for pipeline commercialization over coming quarters.

Innoviva Business Overview & Revenue Model

Company Description

Innoviva, Inc. engages in the development and commercialization of pharmaceuticals in the United States and internationally. Its products include RELVAR/BREO ELLIPTA, a once-daily combination medicine consisting of a LABA, vilanterol (VI), an inhaled corticosteroid (ICS), and fluticasone furoate; ANORO ELLIPTA, a once-daily medicine combining a long-acting muscarinic antagonist (LAMA), umeclidinium bromide (UMEC), with a LABA, and VI; and TRELEGY ELLIPTA, a once-daily combination medicine consisting of an ICS, LAMA, and LABA. Innoviva, Inc. has a strategic partnership with Sarissa Capital Management LP. The company has long-acting beta2 agonist (LABA) collaboration agreement with Glaxo Group Limited to develop and commercialize once-daily products for the treatment of chronic obstructive pulmonary disease and asthma. The company was formerly known as Theravance, Inc. and changed its name to Innoviva, Inc. in January 2016. Innoviva, Inc. was incorporated in 1996 and is headquartered in Burlingame, California.

How the Company Makes Money

Innoviva generates revenue primarily through its partnerships and collaborations with other pharmaceutical companies. The company earns royalties from the sales of its partnered products, leveraging its proprietary technologies and drug delivery systems. Additionally, Innoviva may receive milestone payments associated with the development and commercialization of its products. The company's strategic alliances with larger pharmaceutical firms provide it with access to broader markets and resources, contributing to its earnings while minimizing the risks associated with drug development.

Innoviva Financial Statement Overview

Summary

Strong fundamentals led by high profitability (2025 gross margin ~74.8%, net margin ~65.9%) and solid cash generation (2025 OCF ~$197M; FCF ~$196M). Balance sheet risk improved materially with debt reported at $0 in 2025 and higher equity (~$1.17B). Key risk is volatility: uneven revenue growth, a sharp 2024 net margin drop before the 2025 rebound, and negative FCF growth in 2025 (down ~37%).

Income Statement

Profitability is a clear strength: 2025 revenue grew ~5.9% with strong gross margin (~74.8%) and very high net margin (~65.9%). Across 2020–2025, net margins are frequently elevated, but results have been volatile (notably the sharp drop in net margin to ~6.5% in 2024 before rebounding strongly in 2025). Revenue growth has also been uneven, with declines in 2022–2023 followed by recovery in 2024–2025, indicating a solid earnings engine but with year-to-year variability.

Balance Sheet

The balance sheet strengthened materially in 2025: total debt is reported at $0 versus ~$449–544M in 2022–2024, and equity increased to ~$1.17B (assets ~$1.64B). Leverage was moderate-to-high in prior years (debt relative to equity roughly 0.65–0.96 in 2022–2024), so the move to no debt significantly reduces financial risk. Returns on equity have also improved sharply in 2025 (~23%), though they have fluctuated meaningfully over time (very strong in some years, weak in 2024).

Cash Flow

Cash generation remains healthy: 2025 operating cash flow was ~$197M and free cash flow was ~$196M, with free cash flow closely matching reported earnings. However, free cash flow growth was negative in 2025 (down ~37%) following a strong 2024 increase, showing variability in cash flow momentum. Overall, the company continues to convert earnings into cash well, but the recent downturn in free cash flow growth is a key watch item.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	425.13M	358.71M	310.46M	331.34M	391.87M
Gross Profit	307.52M	322.11M	267.82M	317.55M	391.87M
EBITDA	383.79M	85.50M	235.04M	308.32M	464.35M
Net Income	271.17M	23.39M	179.72M	213.92M	265.85M
Balance Sheet
Total Assets	1.64B	1.30B	1.24B	1.23B	926.39M
Cash, Cash Equivalents and Short-Term Investments	550.94M	412.50M	193.51M	291.05M	201.53M
Total Debt	0.00	451.10M	449.08M	544.07M	394.76M
Total Liabilities	462.32M	609.90M	568.55M	665.71M	400.46M
Stockholders Equity	1.17B	691.16M	674.96M	565.79M	414.74M
Cash Flow
Free Cash Flow	195.80M	188.42M	140.65M	201.66M	362.51M
Operating Cash Flow	196.93M	188.69M	141.06M	201.73M	363.81M
Investing Cash Flow	40.50M	-63.79M	-66.76M	-56.63M	43.72M
Financing Cash Flow	8.55M	-13.45M	-171.84M	-55.57M	-452.50M

Innoviva Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 22.96
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For INVA, the sentiment is Positive. The current price of 22.96 is above the 20-day moving average (MA) of 22.50, above the 50-day MA of 20.83, and above the 200-day MA of 19.93, indicating a bullish trend. The MACD of 0.86 indicates Negative momentum. The RSI at 59.10 is Neutral, neither overbought nor oversold. The STOCH value of 53.04 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for INVA.

Innoviva Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
INVA	74 Outperform	$1.70B	7.51	29.09%	―	9.76%	88.06%
LENZ	57 Neutral	$422.10M	-6.40	-28.78%	―	―	70.19%
RAPP	56 Neutral	$1.38B	-10.78	-23.41%	―	―	-37.07%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
XERS	46 Neutral	$1.02B	-59.19	―	―	42.05%	76.50%