Amgen
AMGN
$438.12
+1.92%
Amgen is a global biotechnology leader focused on developing and commercializing innovative human therapeutics across oncology, inflammation, bone health, and rare diseases, with a growing biosimilar portfolio. The company holds a strong market position as one of the world's largest independent biotech firms, differentiated by its deep pipeline, blockbuster drugs like Prolia and Repatha, and strategic acquisitions such as Horizon Therapeutics. Currently, the investor narrative centers on Amgen's robust growth trajectory, driven by recent product launches and the Horizon integration, while also weighing regulatory concerns around Tavneos and the potential impact of drug pricing tariffs. The stock has seen strong momentum, with a 51.4% gain over the past year, reflecting optimism about its pipeline and commercial execution.…
AMGN
Amgen
$438.12
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Investment Opinion: Should I buy AMGN Today?
Based on the analysis, I rate AMGN as a Hold. The stock has strong fundamentals with a forward PE of 17.72x, revenue growth of 5.76%, and a dividend yield of 2.91%, but the current price exceeds the average analyst target of $388.48, suggesting limited upside. The consensus rating is 'Buy', but the mean target implies -10.2% downside, indicating the stock is overvalued relative to analyst expectations.
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AMGN 12-Month Price Forecast
Amgen's fundamentals are strong, but the stock has run ahead of analyst targets, and regulatory overhangs create downside risk. The valuation is attractive on a forward basis, but the near-term upside is limited. I would upgrade to bullish if regulatory issues are resolved positively and revenue growth accelerates above 7%, or downgrade to bearish if Tavneos faces severe restrictions or tariffs are imposed without exemptions.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Amgen's 12-month outlook, with a consensus price target around $388.48 and implied upside of -11.3% versus the current price.
Average Target
$388.48
0 analysts
Implied Upside
-11.3%
vs. current price
Analyst Count
—
covering this stock
Price Range
$230 - $457
Analyst target range
Amgen is covered by 29 analysts, with a consensus recommendation of 'Buy' and a mean rating of 2.47 (where 1 is Strong Buy and 5 is Sell). The average target price is $388.48, which implies a downside of -10.2% from the current price of $432.42, indicating that the stock has surpassed analyst expectations. The target range is wide, from a low of $230.00 to a high of $457.00, reflecting significant uncertainty about the company's future prospects. The high target of $457.00 suggests potential upside of 5.7%, while the low target implies a downside of -46.8%, highlighting the risk. Recent ratings from firms like UBS (Buy) and Piper Sandler (Overweight) show a positive tilt, but several neutral/hold ratings from Morgan Stanley and Guggenheim indicate a cautious stance. The wide spread between the low and high targets suggests high uncertainty, likely due to regulatory risks and competitive pressures in the biotech sector.
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Bulls vs Bears: AMGN Investment Factors
Amgen presents a mixed picture: strong fundamentals with high margins, robust cash flow, and attractive valuation, but offset by regulatory risks, high debt, and a stock price that has outpaced analyst targets. The bull case is supported by solid revenue growth and a discounted valuation, while the bear case hinges on regulatory overhangs and potential tariff impacts. Currently, the bull case has slightly stronger evidence given the PEG ratio of 0.26 and strong cash generation, but the key tension is whether regulatory issues (Tavneos) and tariff threats will materialize into financial damage, which could quickly shift the balance.
Bullish
- Strong Revenue Growth: Q1 2026 revenue grew 5.76% YoY to $8.618B, with sequential growth from Q1 2025's $8.149B. This demonstrates consistent demand for Amgen's portfolio despite competitive pressures.
- Attractive Valuation: Forward PE of 17.72x is below the industry average of 25-30x, and the PEG ratio of 0.26 suggests undervaluation relative to growth. The trailing PE of 22.84x is near the lower end of its historical range (11.36x-75.23x).
- High Profitability: Gross margin is 70.8%, operating margin 29.1%, and net margin 21.0% (Q1 2026). These metrics indicate strong pricing power and operational efficiency, supporting robust cash generation.
- Robust Free Cash Flow: TTM free cash flow is $8.597B, providing ample capacity for dividends, debt reduction, and pipeline investment. The dividend yield of 2.91% offers income with a payout ratio of 66.5%.
Bearish
- Stock Trades Above Analyst Target: Current price of $432.42 is 11.3% above the average analyst target of $388.48, implying limited upside or potential downside. The high target of $457 offers only 5.7% upside, while the low target of $230 suggests -46.8% risk.
- Regulatory and Safety Concerns: FDA warnings about fatal liver risks and data manipulation issues with Tavneos could lead to restrictions, lawsuits, and reputational damage. This introduces significant uncertainty for a key rare disease drug.
- High Debt Levels: Debt-to-equity ratio of 6.31x is extremely high, reflecting the Horizon acquisition. Interest expense of $657M in Q1 2026 pressures net income, though current ratio of 1.14x indicates adequate liquidity.
- Potential Tariff Impact: Proposed 100% tariffs on imported drugs could increase costs or disrupt supply chains if Amgen doesn't have exemption deals. This could compress margins and hurt competitiveness.
AMGN Technical Analysis
Amgen's stock is in a clear sustained uptrend, with a 1-year price change of +51.4% and a current price of $432.42, which sits near the top of its 52-week range (52-week high of $447.03, low of $269.77). The stock is trading at approximately 96.7% of its 52-week range, indicating strong momentum and bullish sentiment, though it may be approaching overbought conditions. The 6-month price change of +11.4% and YTD change of +32.0% confirm the longer-term bullish trend, with the stock consistently making higher highs and higher lows.
Beta
0.41
0.41x market volatility
Max Drawdown
-16.6%
Largest decline past year
52-Week Range
$270-$447
Price range past year
Annual Return
+52.3%
Cumulative gain past year
| Period | AMGN Return | S&P 500 |
|---|---|---|
| 1m | +13.8% | +2.0% |
| 3m | +29.5% | +1.0% |
| 6m | +19.2% | +11.8% |
| 1y | +52.3% | +18.1% |
| ytd | +33.7% | +11.7% |
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AMGN Fundamental Analysis
Amgen's revenue trajectory is solidly growing, with Q1 2026 revenue of $8.618 billion, up 5.76% year-over-year, and sequential growth from $8.149 billion in Q1 2025. The multi-quarter trend shows revenue increasing from $8.388 billion in Q2 2024 to $9.896 billion in Q4 2025, though Q1 2026 saw a slight dip from Q4 2025, which is typical seasonality. Growth is driven by key products like Prolia ($1.054 billion), Otezla ($625 million), and EVENITY ($599 million), while the 'Other Products' segment ($2.073 billion) remains a significant contributor. The company's ability to sustain mid-single-digit growth in a competitive market is a positive sign for the investment case.
Quarterly Revenue
$8.6B
2026-03
Revenue YoY Growth
+5.8%
YoY Comparison
Gross Margin
68.2%
Latest Quarter
Free Cash Flow
$8.6B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is AMGN Overvalued?
Given Amgen's positive net income, the PE ratio is the primary valuation metric. The trailing PE is 22.84x, while the forward PE is 17.72x, indicating the market expects earnings growth. The gap between trailing and forward PE suggests an expected EPS increase of about 28.9%, reflecting optimism about future profitability. Amgen's PE of 22.84x is below the industry average for drug manufacturers, which typically trades around 25-30x, representing a discount of approximately 8-24%. This discount is justified by Amgen's lower growth rate compared to some peers, but its strong free cash flow and dividend yield of 2.91% provide a value proposition. Historically, Amgen's PE has ranged from 11.36x to 75.23x over the past few years, with the current 22.84x sitting near the lower end of that range, suggesting the stock is undervalued relative to its own history.
PE
22.8x
Latest Quarter
vs. Historical
Mid-Range
5-Year PE Range 11x~33x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
13.1x
Enterprise Value Multiple
Investment Risk Disclosure
Financial risks are significant due to Amgen's high leverage, with a debt-to-equity ratio of 6.31x, largely from the Horizon acquisition. Interest expenses of $657M in Q1 2026 reduce net income, and the payout ratio of 66.5% leaves limited room for dividend increases. However, the current ratio of 1.14x and strong free cash flow of $8.6B provide a cushion. Revenue concentration in key products like Prolia ($1.054B) and Otezla ($625M) exposes the company to patent cliffs and competition, though the diversified portfolio mitigates this somewhat.