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Revolution Medicines (RVMD)
NASDAQ:RVMD
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Revolution Medicines
(NASDAQ:RVMD)
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Rating:55Neutral
Price Target:
$100.00
▲(0.18% Upside)
Overall score reflects a solid balance sheet and positive clinical/regulatory momentum from the latest earnings call, tempered by very weak current financial performance (near-zero revenue, widening losses, heavy cash burn). Technicals are mixed but generally supportive over longer timeframes, while valuation is constrained by negative earnings and no dividend.
Positive Factors
Regulatory momentum for daraxonrasib
Regulatory designations materially increase the probability of expedited review, priority access to FDA resources, and potential exclusivity. Over the medium term this raises the likelihood and speed of approval and commercial launch for daraxonrasib in defined patient populations.
Strong liquidity and committed capital
A cash balance of $1.93B plus $1.75B committed capital provides a meaningful runway to advance pivotal trials and commercialization planning. This reduces near-term financing pressure and dilution risk, enabling sustained investment in lead programs over the next several quarters.
Focused RAS-targeted pipeline
A concentrated RAS/MAPK franchise focused on genetically defined oncology populations is a durable competitive advantage. Multiple targeted small-molecule programs diversify development risk and increase the structural chance that one program achieves regulatory success and commercial traction.
Negative Factors
Near-zero revenue and widening losses
The company remains pre-commercial with negligible product revenue and a large TTM net loss. Long-term sustainability depends on clinical success or external funding; without product cashflows, continued losses create lasting financing and dilution risk until commercialization.
High negative cash flow and rising burn
Sustained negative operating and free cash flow at scale forces reliance on capital markets or partners. Structurally, heavy burn limits optionality, may require program prioritization, and raises refinancing risk if market access weakens, impacting long-term program execution.
Rising operating expenses and large net loss guidance
Material increases in R&D and G&A expand the fixed cost base while the business is pre-revenue. Persistently high operating spend, coupled with billion-dollar net loss guidance, increases the need for sustained external financing and creates structural pressure on margins until revenues emerge.
Revolution Medicines (RVMD) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$18.90B
Dividend YieldN/A
Average Volume (3M)4.30M
Price to Earnings (P/E)―
Beta (1Y)1.00
Revenue Growth-100.00%
EPS Growth-44.24%
CountryUS
Employees616
SectorHealthcare
Sector Strength45
IndustryBiotechnology
Share Statistics
EPS (TTM)-1.61
Shares Outstanding193,319,810
10 Day Avg. Volume4,038,428
30 Day Avg. Volume4,297,042
Financial Highlights & Ratios
PEG Ratio1.69
Price to Book (P/B)3.24
Price to Sales (P/S)0.00
P/FCF Ratio-12.92
Enterprise Value/Market Cap0.99
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit-4.93K
Enterprise Value/Ebitda-18.75
Forecast
1Y Price Target
$115.87Price Target Upside16.08% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering17
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Revolution Medicines Business Overview & Revenue Model
Company DescriptionRevolution Medicines, Inc., a clinical-stage precision oncology company, focuses on developing therapies to inhibit frontier targets in RAS-addicted cancers. The company is developing RMC-4630, an inhibitor of SHP2, which is in Phase 1/2 clinical trial for the treatment of solid tumors, such as gynecologic and colorectal cancer tumors. It also develops RMC-5845, a selective inhibitor of SOS1, a protein that converts RAS (OFF) to RAS (ON) in cells; and RMC-5552, a hyperactivated selective inhibitor of mTORC1 signaling in tumors. In addition, the company is developing RMC-6291, a mutant-selective inhibitor of KRASG12C(ON) and NRASG12C(ON); and RMC-6236, a RAS-selective inhibitor of multiple RAS(ON) variants. Further, it develops RAS(ON) Inhibitors targeting KRASG13C(ON) and KRASG12D(ON). The company has a collaboration agreement with Sanofi for the research and development of SHP2 inhibitors, including RMC-4630. Revolution Medicines, Inc. was incorporated in 2014 and is headquartered in Redwood City, California.
How the Company Makes MoneyRevolution Medicines generates revenue primarily through strategic collaborations, research and development partnerships, and milestone payments from other pharmaceutical companies. The company enters into agreements with larger pharmaceutical firms to co-develop and commercialize its drug candidates, often receiving upfront payments, research funding, and future royalties on sales of successfully developed products. Additionally, Revolution Medicines may also benefit from licensing agreements, wherein it grants other companies the rights to use its proprietary technologies or compounds in exchange for licensing fees.
Revolution Medicines Earnings Call Summary
Earnings Call Date:Nov 05, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Mar 02, 2026
Earnings Call Sentiment Positive
The earnings call reflected strong progress in clinical programs and regulatory achievements for daraxonrasib, as well as a solid financial position supported by strategic partnerships. However, these positive developments were somewhat offset by increased operating expenses and significant net losses.Q3-2025 Updates
Positive Updates
Positive Clinical Progress with Daraxonrasib
Daraxonrasib showed compelling clinical activity in pancreatic cancer, with an objective response rate of 47% as monotherapy and 55% when combined with chemotherapy. Disease control rates were 89% and 90% respectively.
Regulatory Achievements for Daraxonrasib
Daraxonrasib received three special designations from the FDA, including Breakthrough Therapy Status, Orphan Drug Designation, and a Commissioner's National Priority Voucher.
Strong Financial Position
Ended Q3 2025 with $1.93 billion in cash and investments, with an additional $1.75 billion in future committed capital from a partnership with Royalty Pharma.
Expansion and Strengthening of Global Operations
Key appointments across commercialization functions, including new regional leaders in the U.S. and European regions, as well as a new Chief Development Officer.
Promising Developments in Non-Small Cell Lung Cancer
Elironrasib demonstrated a confirmed objective response rate of 42% and a disease control rate of 79% in heavily pretreated non-small cell lung cancer patients.
Negative Updates
Increased Operating Expenses
R&D expenses increased to $262.5 million, up from $151.8 million in the previous year, primarily due to clinical trial-related and manufacturing expenses.
Significant Net Loss
Reported a net loss of $305.2 million for Q3 2025, compared to $156.3 million for the same period in 2024, driven by higher operating expenses.
Company Guidance
During the Q3 2025 earnings call, Revolution Medicines provided several key metrics as part of their guidance. They reiterated their 2025 financial guidance, projecting a full-year GAAP net loss between $1.03 billion and $1.09 billion, which includes estimated non-cash stock-based compensation expense between $115 million and $130 million. Research and development (R&D) expenses for Q3 2025 were reported at $262.5 million, a significant increase from $151.8 million in Q3 2024, primarily due to clinical trial-related expenses and manufacturing costs for their three clinical-stage programs, particularly daraxonrasib. General and administrative (G&A) expenses rose to $52.8 million in Q3 2025 from $24.0 million in Q3 2024, driven by increases in personnel-related expenses and commercial preparation activities. Revolution Medicines ended Q3 with $1.93 billion in cash and investments, including a $250 million royalty monetization tranche from Royalty Pharma and an additional $1.75 billion in future committed capital under the arrangement.Revolution Medicines Financial Statement Overview
Summary
Financials reflect an R&D-stage biotech: the balance sheet is a relative strength (modest leverage), but operating performance is very weak with near-zero revenue, widening losses, and heavy ongoing cash burn that increases financing/dilution risk.Income Statement
The income statement remains very weak, reflecting a pre-commercial biotech profile. Revenue is minimal and has effectively fallen to zero in 2024 and TTM (Trailing-Twelve-Months), while losses have widened materially (net loss of about $961M in TTM vs. ~$600M in 2024). Margins are not meaningful given the lack of revenue, and profitability is deteriorating as operating expenses scale faster than any top-line contribution.18
Very Negative
Balance Sheet
The balance sheet is a relative strength. Leverage is modest with low debt versus equity (debt-to-equity ~0.10 in TTM), giving the company flexibility to fund R&D. That said, equity returns are deeply negative (ROE about -49% in TTM) due to heavy losses, and total equity has declined from 2024 to TTM—highlighting ongoing capital consumption risk if losses persist.72
Positive
Cash Flow
Cash flow is pressured by sustained cash burn. Operating cash flow and free cash flow are strongly negative in TTM (around -$762M and -$777M, respectively), and the burn rate increased versus 2024. A positive point is that free cash flow broadly tracks net income (free cash flow is roughly in line with net loss), suggesting losses are not being masked by large non-cash gains—however, the magnitude of ongoing outflows remains the key concern.26
Negative
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 0.00 | 0.00 | 11.58M | 35.38M | 29.39M | 42.98M |
| Gross Profit | -3.80M | 0.00 | 11.58M | 35.38M | 29.39M | 42.98M |
| EBITDA | -1.00B | -677.70M | -477.88M | -248.62M | -179.75M | -101.91M |
| Net Income | -960.98M | -600.09M | -436.37M | -248.71M | -187.09M | -108.16M |
Balance Sheet | ||||||
| Total Assets | 2.25B | 2.56B | 2.06B | 811.93M | 737.99M | 567.40M |
| Cash, Cash Equivalents and Short-Term Investments | 1.93B | 2.29B | 1.85B | 644.94M | 577.05M | 440.74M |
| Total Debt | 158.46M | 135.84M | 87.94M | 64.20M | 66.63M | 32.66M |
| Total Liabilities | 655.02M | 293.10M | 235.51M | 126.74M | 135.42M | 92.72M |
| Stockholders Equity | 1.60B | 2.27B | 1.83B | 685.19M | 602.57M | 474.68M |
Cash Flow | ||||||
| Free Cash Flow | -777.08M | -567.74M | -358.30M | -235.22M | -153.71M | -103.00M |
| Operating Cash Flow | -761.79M | -557.44M | -350.57M | -224.40M | -147.18M | -100.06M |
| Investing Cash Flow | -349.73M | -554.39M | -342.60M | -24.12M | -142.12M | -234.23M |
| Financing Cash Flow | 1.13B | 959.41M | 1.23B | 301.43M | 294.18M | 422.78M |
Revolution Medicines Technical Analysis
Neutral
99.82
Price Trends
87.10
Positive
68.62
Positive
53.45
Positive
Market Momentum
7.72
Positive
49.28
Neutral
25.97
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RVMD, the sentiment is Neutral. The current price of 99.82 is below the 20-day moving average (MA) of 103.77, above the 50-day MA of 87.10, and above the 200-day MA of 53.45, indicating a neutral trend. The MACD of 7.72 indicates Positive momentum. The RSI at 49.28 is Neutral, neither overbought nor oversold. The STOCH value of 25.97 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for RVMD.
Revolution Medicines Risk Analysis
Revolution Medicines disclosed 83 risk factors in its most recent earnings report. Revolution Medicines reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Revolution Medicines Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
64 Neutral | $4.80B | 52.81 | 16.47% | ― | 17.92% | -26.13% | |
56 Neutral | $13.12B | -48.00 | -39.99% | ― | 20.39% | 34.00% | |
55 Neutral | $18.90B | -19.27 | -60.76% | ― | -100.00% | -44.24% | |
52 Neutral | $6.99B | -11.04 | -20.83% | ― | ― | -5.21% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
50 Neutral | $3.50B | -13.99 | -22.60% | ― | 74.91% | 31.54% |
* Healthcare Sector Average
RVMD
Revolution Medicines
99.82
58.90
143.94%
CORT
Corcept Therapeutics
46.22
-15.31
-24.88%
IONS
Ionis Pharmaceuticals
82.14
49.26
149.82%
LEGN
Legend Biotech
18.27
-17.83
-49.39%
PCVX
Vaxcyte
54.35
-34.32
-38.71%
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.