Royalty Pharma PLC (RPRX)
NASDAQ:RPRX
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Royalty Pharma
(NASDAQ:RPRX)
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Rating:76Outperform
Price Target:
$54.00
▲(12.73% Upside)
Action:ReiteratedDate:04/14/26
The score is driven primarily by strong underlying financial performance (high profitability and robust free cash flow) and supportive technical momentum (price above major moving averages with positive MACD). Offsetting factors include mid-range valuation and near-term headwinds flagged in 2026 guidance (slower growth, lower milestones, and higher interest expense), while the recent positive daraxonrasib milestone provides a modest additional tailwind.
Positive Factors
Cash generation
Royalty Pharma consistently generates very strong operating and free cash flow (~$2–$3B annually). Durable FCF funds acquisitions, dividends, and buybacks without reliance on dilutive equity, supporting repeatable capital deployment and cushioning timing volatility in milestones or trial outcomes.
Negative Factors
High leverage
Investment-grade debt near $9B and debt running around 0.9–1.3x equity represent meaningful leverage. Elevated debt limits financial flexibility for opportunistic transactions, increases refinancing and covenant risk in tougher markets, and amplifies sensitivity to rising interest costs over the medium term.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash generation
Royalty Pharma consistently generates very strong operating and free cash flow (~$2–$3B annually). Durable FCF funds acquisitions, dividends, and buybacks without reliance on dilutive equity, supporting repeatable capital deployment and cushioning timing volatility in milestones or trial outcomes.
Read all positive factors
Royalty Pharma (RPRX) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$27.63B
Dividend Yield2.23%
Average Volume (3M)3.18M
Price to Earnings (P/E)21.6
Beta (1Y)0.17
Revenue Growth3.72%
EPS Growth-31.46%
CountryUS
Employees75
SectorHealthcare
Sector Strength45
IndustryBiotechnology
Share Statistics
EPS (TTM)1.47
Shares Outstanding428,418,600
10 Day Avg. Volume2,488,097
30 Day Avg. Volume3,179,414
Financial Highlights & Ratios
PEG Ratio1.04
Price to Book (P/B)2.58
Price to Sales (P/S)7.02
P/FCF Ratio6.70
Enterprise Value/Market Cap1.05
Enterprise Value/Revenue12.23
Enterprise Value/Gross Profit12.23
Enterprise Value/Ebitda17.79
Forecast
1Y Price Target
$53.14Price Target Upside10.95% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering8
EPS Forecast (FY)4.91
Revenue Forecast (FY)$3.25B
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 variou...
How the Company Makes Money
Royalty Pharma makes money primarily by collecting royalty and similar payments that are contractually based on the net sales of specific biopharmaceutical products. Its core revenue stream is “portfolio receipts” (cash inflows from its royalty in...
Royalty Pharma Key Performance Indicators (KPIs)
Any
Portfolio Receipts
Tracks the income generated from the company's portfolio of royalty interests, highlighting cash flow stability and the effectiveness of its investment strategy in acquiring lucrative royalty streams.
Tracks the income generated from the company's portfolio of royalty interests, highlighting cash flow stability and the effectiveness of its investment strategy in acquiring lucrative royalty streams.
Data provided by:
The Fly
The FlyRoyalty Pharma Earnings Call Summary
Earnings Call Date:Feb 11, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 07, 2026
Earnings Call Sentiment Positive
The call emphasized strong 2025 execution: double-digit growth in royalty and portfolio receipts, attractive returns (ROIC 15.8%, ROIE 22.8%), record synthetic royalty activity, achievement of capital deployment targets ahead of schedule, significant cash generation ($2.7B portfolio cash flow) and meaningful shareholder returns (repurchases and a 7% dividend increase). Offsetting factors include moderated 2026 top-line guidance (royalty growth 3%–8%), a sizable expected drop in milestone receipts (~$68M), higher interest expense in 2026, and execution/timing risk around several pivotal clinical readouts and an ongoing arbitration. Overall, the positives around growth, returns, liquidity, synthetic royalty momentum, and cost savings from internalization outweigh the near-term headwinds and event risks.Positive Updates
Strong Top-Line Growth
Royalty receipts grew 13% for the full year and 17% in Q4; portfolio receipts (including milestones) grew 16% for the year and 18% in Q4, outperforming initial guidance and prompting three guidance raises during 2025.
Negative Updates
2026 Top-Line Headwinds and Lower Near-Term Growth
2026 guidance assumes royalty receipts growth of only 3%–8%, reflecting headwinds including loss of exclusivity for Promacta, a U.S. biosimilar launch for Tysabri, and an expected reduction in milestones and other contractual receipts from $128M in 2025 to ~ $60M in 2026 (a decline of ~$68M, ~53%).
Read all updates
Q4-2025 Updates
Positive
Negative
Strong Top-Line Growth
Royalty receipts grew 13% for the full year and 17% in Q4; portfolio receipts (including milestones) grew 16% for the year and 18% in Q4, outperforming initial guidance and prompting three guidance raises during 2025.
Read all positive updates
Company Guidance
Royalty Pharma's 2026 guidance calls for portfolio receipts of $3.275 billion to $3.425 billion, which implies royalty‑receipts growth of about 3% to 8% (based on the current portfolio and excluding any benefit from future transactions); milestones and other contractual receipts are expected to fall from $128 million in 2025 to roughly $60 million in 2026 (about $70 million lower year‑over‑year), operating and professional costs are forecast at 5%–6.5% of portfolio receipts (versus 8.9% for 2025 and 6.7% in Q4), and interest paid is expected to be ~$350 million–$360 million (with ~ $175 million in each of Q1 and Q3 and de minimis amounts in Q2 and Q4); the guidance excludes interest received on cash (which was $34 million in 2025) and anticipates approximately $85 million of equity performance awards in 2026 (with about half the value reflected in share count); assumptions explicitly reflect Promacta LOE, a U.S. Tysabri biosimilar launch, and potential IRS impact.Royalty Pharma Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
67
Positive
Cash Flow
86
Very Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 2.38B | 2.26B | 2.35B | 2.24B | 2.29B |
| Gross Profit | 2.38B | 2.26B | 2.35B | 2.24B | 2.29B |
| EBITDA | 1.64B | 1.56B | 1.89B | 423.69M | 1.43B |
| Net Income | 770.95M | 858.98M | 1.13B | 42.83M | 619.73M |
Balance Sheet | |||||
| Total Assets | 19.62B | 18.22B | 16.38B | 16.81B | 17.52B |
| Cash, Cash Equivalents and Short-Term Investments | 637.50M | 1.77B | 1.23B | 2.43B | 2.80B |
| Total Debt | 8.95B | 7.61B | 6.14B | 7.12B | 7.10B |
| Total Liabilities | 9.91B | 7.88B | 6.30B | 7.29B | 7.27B |
| Stockholders Equity | 6.48B | 6.95B | 6.53B | 5.63B | 5.78B |
Cash Flow | |||||
| Free Cash Flow | 2.49B | 2.77B | 2.99B | 2.14B | 2.02B |
| Operating Cash Flow | 2.49B | 2.77B | 2.99B | 2.14B | 2.02B |
| Investing Cash Flow | -1.61B | -2.68B | -2.07B | -1.03B | -1.87B |
| Financing Cash Flow | -1.19B | 361.14M | -2.15B | -944.86M | 385.11M |
Royalty Pharma Technical Analysis
Positive
47.90
Price Trends
45.63
Positive
42.42
Positive
39.23
Positive
Market Momentum
0.74
Negative
59.21
Neutral
65.60
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 47.9 is above the 20-day moving average (MA) of 46.79, above the 50-day MA of 45.63, and above the 200-day MA of 39.23, indicating a bullish trend. The MACD of 0.74 indicates Negative momentum. The RSI at 59.21 is Neutral, neither overbought nor oversold. The STOCH value of 65.60 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RPRX.
Royalty Pharma Risk Analysis
Royalty Pharma disclosed 58 risk factors in its most recent earnings report. Royalty Pharma reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Royalty Pharma Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
84 Outperform | $25.06B | 16.17 | 19.30% | ― | 13.50% | 17.16% | |
76 Outperform | $27.63B | 21.65 | 11.89% | 2.23% | 3.72% | -31.46% | |
74 Outperform | $19.12B | 14.98 | 29.15% | ― | 18.09% | 3563.21% | |
66 Neutral | $17.25B | 19.86 | 18.99% | ― | 24.98% | 127.06% | |
57 Neutral | $14.69B | -50.22 | 127.54% | ― | 103.32% | 47.55% | |
54 Neutral | $24.00B | -17.95 | -6.03% | ― | 7.04% | -25.24% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% |
* Healthcare Sector Average
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Royalty Pharma Corporate Events
Business Operations and StrategyPrivate Placements and FinancingProduct-Related Announcements
Royalty Pharma Expands Daraxonrasib Royalty Stake After Milestone
Positive
Apr 13, 2026
On April 13, 2026, Revolution Medicines reported positive Phase 3 results for its RAS(ON) inhibitor daraxonrasib in previously treated metastatic pancreatic cancer, fulfilling primary and key secondary endpoints and supporting planned global regul...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.