Royalty Pharma (RPRX) AI Stock Analysis

• Market Cap: $23.21B
• Dividend Yield: 2.23%
• Average Volume (3M): 3.76M
• Price to Earnings (P/E): 23.0
• Beta (1Y): 0.19
• Revenue Growth: 3.72%
• EPS Growth: -31.46%
• Country: US
• Employees: 75
• Sector: Healthcare
• Sector Strength: 45
• Industry: Biotechnology
• EPS (TTM): 1.17
• Shares Outstanding: 427,247,500
• 10 Day Avg. Volume: 3,274,816
• 30 Day Avg. Volume: 3,755,349
• PEG Ratio: -0.55
• Price to Book (P/B): 1.64
• Price to Sales (P/S): 5.03
• P/FCF Ratio: 4.11
• Enterprise Value/Market Cap: 0.00
• Enterprise Value/Revenue: 0.00
• Enterprise Value/Gross Profit: 0.00
• Enterprise Value/Ebitda: 0.00
• 1Y Price Target: $46.50
• Price Target Upside: 15.64% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2
• EPS Forecast (FY): 4.8
• Revenue Forecast (FY): $3.16B

• Rating: 80 Outperform
• Price Target: $45.00 ▲(11.91% Upside)

The score is driven primarily by strong financial performance (exceptional margins and solid cash generation) and a bullish earnings update with raised 2025 guidance and continued capital deployment. Technicals support the view with an established uptrend, while valuation is reasonable but not cheap, and leverage/interest expense plus the upcoming Promacta royalty decline temper the upside.

Positive Factors

Revenue Growth

The 11% growth in portfolio and royalty receipts highlights Royalty Pharma's effective strategy in expanding its revenue base, ensuring sustained financial performance over the medium term.

Strategic Acquisitions

Strategic acquisitions of high-value royalty interests enhance Royalty Pharma's portfolio, providing long-term revenue streams and strengthening its market position.

FDA Approval of MYQORZO

The FDA approval of MYQORZO enhances Royalty Pharma's future cash-flow visibility and strengthens its portfolio with a newly approved cardiovascular therapy.

Negative Factors

Promacta Royalty Decline

The anticipated decline in Promacta royalties due to generic competition poses a risk to Royalty Pharma's revenue, affecting its long-term income stability.

Increased Interest Expenses

Rising interest expenses could pressure Royalty Pharma's financial flexibility, impacting its ability to invest in new opportunities and manage debt effectively.

Negative Free Cash Flow Growth

The negative free cash flow growth indicates potential challenges in cash generation, which may affect Royalty Pharma's ability to fund future investments and shareholder returns.

Royalty Pharma Business Overview & Revenue Model

Company Description

Royalty Pharma plc operates as a buyer of biopharmaceutical royalties and a funder of innovations in the biopharmaceutical industry in the United States. It is also involved in the identification, evaluation, and acquisition of royalties on various biopharmaceutical therapies. In addition, the company collaborates with innovators from academic institutions, research hospitals and not-for-profits, small and mid-cap biotechnology companies, and pharmaceutical companies. Its portfolio consists of royalties on approximately 35 marketed therapies and 10 development-stage product candidates that address various therapeutic areas, such as rare disease, cancer, neurology, infectious disease, hematology, and diabetes. The company was founded in 1996 and is based in New York, New York.

How the Company Makes Money

Royalty Pharma generates revenue primarily through its portfolio of royalty interests in various biopharmaceutical products. The company acquires these royalties from other companies, often taking an upfront payment in exchange for a percentage of future sales from established drugs. This revenue model capitalizes on the success of marketed therapies, allowing Royalty Pharma to earn income as long as the drugs continue to generate sales. Key revenue streams include royalties from high-performing drugs in areas such as oncology, rare diseases, and infectious diseases. Additionally, Royalty Pharma has formed strategic partnerships and collaborations with leading biopharmaceutical companies, which enhance its revenue opportunities and provide access to new drugs in development. The company's ability to identify and invest in promising therapies is a significant factor contributing to its earnings.

Royalty Pharma Financial Statement Overview

Summary

Royalty Pharma exhibits strong financial health with high profitability, efficient cash flow management, and a solid equity base. While revenue growth is stable, the company shows potential for further expansion. Leverage is moderate, and cash flow generation remains robust, although recent free cash flow growth has declined slightly. Overall, the company is well-positioned in the biotechnology industry with a strong financial foundation.

Income Statement

Royalty Pharma demonstrates strong profitability with a consistent gross profit margin of 100% and a robust EBIT margin of 83.76% in TTM. The net profit margin has improved to 44.28% in TTM, indicating enhanced efficiency. Revenue growth is modest at 1.94% in TTM, showing stability but limited expansion. Overall, the company maintains high profitability and stable revenue growth.

Balance Sheet

The company's debt-to-equity ratio stands at 1.26 in TTM, indicating moderate leverage. Return on equity is healthy at 15.20%, reflecting effective use of equity to generate profits. The equity ratio is not directly provided, but the balance sheet shows a solid equity base. While leverage is slightly high, the company maintains a strong equity position and profitability.

Cash Flow

Operating cash flow to net income ratio is strong at 2.05 in TTM, indicating efficient cash generation relative to net income. Free cash flow to net income ratio is stable at 1.0, showing consistent cash flow management. However, free cash flow growth is negative at -2.55%, suggesting a slight decline in cash flow generation. Overall, cash flow metrics are solid, with some room for improvement in growth.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.35B	2.26B	2.35B	2.24B	2.29B	2.12B
Gross Profit	2.35B	2.26B	2.35B	2.24B	2.29B	1.89B
EBITDA	1.58B	1.56B	1.89B	423.69M	1.43B	1.68B
Net Income	764.96M	858.98M	1.13B	42.83M	619.73M	975.04M
Balance Sheet
Total Assets	19.35B	18.22B	16.38B	16.81B	17.52B	16.02B
Cash, Cash Equivalents and Short-Term Investments	955.04M	1.77B	1.23B	2.43B	2.80B	2.65B
Total Debt	8.97B	7.61B	6.14B	7.12B	7.10B	5.82B
Total Liabilities	9.73B	7.88B	6.30B	7.29B	7.27B	6.12B
Stockholders Equity	6.41B	6.95B	6.53B	5.63B	5.78B	4.82B
Cash Flow
Free Cash Flow	2.41B	2.77B	2.99B	2.14B	2.02B	2.03B
Operating Cash Flow	2.41B	2.77B	2.99B	2.14B	2.02B	2.03B
Investing Cash Flow	-1.27B	-2.68B	-2.07B	-1.03B	-1.87B	-2.76B
Financing Cash Flow	-1.14B	361.14M	-2.15B	-944.86M	385.11M	1.49B

Royalty Pharma Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 40.21
• 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 RPRX, the sentiment is Positive. The current price of 40.21 is above the 20-day moving average (MA) of 39.52, above the 50-day MA of 39.26, and above the 200-day MA of 35.78, indicating a bullish trend. The MACD of 0.39 indicates Negative momentum. The RSI at 52.07 is Neutral, neither overbought nor oversold. The STOCH value of 51.64 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RPRX.

Royalty Pharma Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
UTHR	83 Outperform	$20.48B	17.89	20.04%	―	13.50%	17.16%
INCY	81 Outperform	$20.80B	17.65	30.39%	―	18.09%	3563.21%
RPRX	80 Outperform	$23.21B	22.99	11.51%	2.23%	3.72%	-31.46%
GMAB	76 Outperform	$21.54B	14.26	28.20%	―	24.98%	127.06%
BNTX	53 Neutral	$26.24B	-40.32	-2.94%	―	7.04%	-25.24%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
ASND	46 Neutral	$13.28B	-50.63	―	―	103.32%	47.55%

Royalty Pharma Corporate Events

Royalty Pharma Announces Planned Legal Leadership Transition

On December 20, 2025, Royalty Pharma plc announced that Executive Vice President and Chief Legal Officer George W. Lloyd, 66, would transition out of his executive role effective December 31, 2025, and remain with the company as a senior advisor under a new standard employee offer letter starting January 1, 2026. Executive Vice President and General Counsel Arthur R. McGivern, 50, who joined the company in October 2022 after serving as a partner at Goodwin Procter LLP, was scheduled to assume Lloyd’s responsibilities on January 1, 2026, marking a planned legal leadership transition that maintains continuity in the company’s senior legal function.

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

Royalty Pharma Gains From FDA Approval of MYQORZO

On December 19, 2025, Cytokinetics announced U.S. FDA approval of MYQORZO (aficamten), a cardiac myosin inhibitor indicated for adult patients with symptomatic obstructive hypertrophic cardiomyopathy, triggering economic benefits to Royalty Pharma under prior funding agreements. Royalty Pharma is entitled to a tiered royalty on MYQORZO sales—4.5% on sales up to $5 billion and 1% above that threshold—and has provided Cytokinetics with up to $450 million in long-term and launch capital related to the drug, of which $275 million has been drawn and $20 million repaid as of September 30, 2025, with total repayments to Royalty Pharma expected to reach 1.9 times the amounts drawn over 10 years, including up to an additional $175 million that Cytokinetics can access following approval, reinforcing Royalty Pharma’s future cash flow visibility and exposure to a newly approved cardiovascular therapy.

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