Amgen
AMGN
$385.16
-0.64%
Amgen is a global biotechnology leader focused on developing and manufacturing human therapeutics for serious illnesses, including cancer, inflammatory diseases, and rare disorders. As one of the world's largest independent biotech firms, it differentiates itself through a deep pipeline of innovative drugs and a growing biosimilar portfolio. The current investor narrative centers on Amgen's ability to sustain growth amid patent expirations, the integration of the Horizon Therapeutics acquisition, and regulatory scrutiny around key drugs like Tavneos. Recent headlines highlight both opportunities from new product launches and risks from safety warnings and tariff uncertainties.…
AMGN
Amgen
$385.16
Related headlines
AMGN 12-Month Price Forecast
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Amgen's 12-month outlook, with a consensus price target around $357.03 and implied upside of -7.3% versus the current price.
Average Target
$357.03
0 analysts
Implied Upside
-7.3%
vs. current price
Analyst Count
—
covering this stock
Price Range
$215 - $427
Analyst target range
Amgen is covered by 29 analysts, with a consensus recommendation of 'Buy' (mean rating 2.44 on a 1-5 scale, where 1 is Strong Buy). The average target price is $356.69, which implies a 5.1% downside from the current price of $376.04. The distribution shows a bullish tilt, but the average target below the current price suggests some caution. The target range spans from a low of $215.00 to a high of $427.00. The high target of $427 implies 13.6% upside, likely assuming successful pipeline launches and margin expansion. The low target of $215 implies a 42.8% downside, pricing in risks from patent cliffs, regulatory setbacks, or competitive pressures. Recent ratings from major firms (UBS, Morgan Stanley, Guggenheim) have been mostly neutral to positive, with no recent downgrades. The wide spread between low and high targets ($212) indicates high uncertainty, which is typical for a large-cap biotech with multiple pipeline catalysts and regulatory overhangs.
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Bulls vs Bears: AMGN Investment Factors
Amgen presents a mixed investment case. On the bull side, strong revenue growth, a low PEG ratio (0.26), high free cash flow yield (4.9%), and improving margins support a positive outlook. The stock's low beta (0.40) and strong relative strength make it a defensive growth play. However, bears point to high leverage (D/E 6.31), an analyst target implying downside, regulatory risks around Tavneos, and patent cliffs. The single most important tension is whether Amgen's pipeline and margin expansion can deliver the 42% earnings growth implied by the forward P/E, given the debt burden and competitive pressures. Currently, the bull case has stronger evidence due to the attractive valuation on a PEG basis and solid operational performance, but the stock's price already reflects much of the optimism.
Bullish
- Strong Revenue Growth and Pipeline Momentum: Q1 2026 revenue grew 5.8% YoY to $8.618B, driven by newer drugs like Tezspire ($474M) and Tepezza ($457M). The forward P/E of 16.0x implies 42% earnings growth, supported by pipeline progress and margin expansion.
- Attractive PEG Ratio of 0.26: With a PEG ratio of 0.26, Amgen trades at a deep discount to its expected earnings growth. This suggests the stock is undervalued relative to its growth prospects, offering a compelling risk/reward for growth-at-a-reasonable-price investors.
- High Free Cash Flow Yield of 4.9%: TTM free cash flow of $8.597B provides a 4.9% yield on the current market cap, supporting debt servicing, dividends, and share buybacks. This cash generation ability is a key buffer against the high debt-to-equity ratio of 6.31.
- Strong Relative Strength and Uptrend: The stock is up 21.9% over the past year, outperforming the S&P 500 by 5.4 percentage points. With a beta of 0.40, Amgen offers defensive characteristics while maintaining upward momentum, trading near its 52-week high of $391.29.
Bearish
- High Debt-to-Equity Ratio of 6.31: Amgen's balance sheet is highly leveraged, with debt-to-equity at 6.31, largely due to the Horizon Therapeutics acquisition. While free cash flow covers interest, any downturn in earnings could strain debt servicing and limit financial flexibility.
- Analyst Average Target Below Current Price: The consensus analyst target of $356.69 implies a 5.1% downside from the current price of $376.04. Despite a 'Buy' rating, the average target suggests the stock is already pricing in optimistic expectations, limiting near-term upside.
- Regulatory and Safety Risks for Tavneos: Recent FDA warnings about fatal liver risks and Japanese partner caution on Tavneos use highlight significant regulatory and reputational risks. This could impact sales of a key rare-disease drug and lead to further scrutiny.
- Patent Expirations and Biosimilar Competition: Legacy drugs like Enbrel ($532M) face biosimilar competition, and several key patents are expiring. This could erode revenue from established products, requiring successful pipeline launches to offset declines.
AMGN Technical Analysis
Amgen is in a sustained uptrend, with the stock up 21.9% over the past year, significantly outperforming the S&P 500's 16.5% gain. The current price of $376.04 sits at 96% of its 52-week range (low $269.77, high $391.29), indicating the stock is near its highs and reflecting strong momentum. This positioning suggests bullish sentiment but also potential overextension, as the stock is close to resistance levels. Short-term momentum is accelerating: the 1-month return is 7.0% and the 3-month return is 9.1%, both outpacing the S&P 500's 0.8% and 3.5% respectively. This divergence from the broader market signals strong relative strength, with the stock gaining 6.2% relative to the S&P over the past month. The 1-month trend aligns with the 1-year uptrend, confirming sustained buying pressure rather than a temporary pullback. Key support lies at the 52-week low of $269.77, while resistance is at the 52-week high of $391.29. A breakout above $391.29 would signal further upside momentum, while a breakdown below $269.77 could indicate a trend reversal. With a beta of 0.40, Amgen is significantly less volatile than the market, making it a defensive holding that offers stability during broader market swings.
Beta
0.40
0.40x market volatility
Max Drawdown
-16.6%
Largest decline past year
52-Week Range
$270-$398
Price range past year
Annual Return
+30.5%
Cumulative gain past year
| Period | AMGN Return | S&P 500 |
|---|---|---|
| 1m | +6.6% | +0.2% |
| 3m | +16.8% | +3.7% |
| 6m | +12.7% | +8.0% |
| 1y | +30.5% | +18.2% |
| ytd | +17.6% | +9.6% |
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AMGN Fundamental Analysis
Amgen's revenue is growing, with Q1 2026 revenue of $8.618 billion, up 5.8% year-over-year. The trailing twelve-month revenue trend shows sequential growth from $8.388 billion in Q2 2024 to $8.618 billion in Q1 2026, though growth has decelerated from double-digit rates in prior years. Key growth drivers include Prolia ($1.054B), Otezla ($625M), and newer launches like Tezspire ($474M) and Tepezza ($457M), while legacy drugs like Enbrel ($532M) face biosimilar competition. The company is profitable, with Q1 2026 net income of $1.819 billion and a net margin of 21.1%. Gross margin is 68.2%, stable compared to recent quarters, while operating margin improved to 30.9% from 14.5% in Q1 2025, reflecting cost discipline. The net margin has fluctuated between 13.5% and 33.7% over the past year, but the overall profitability trend is solid. Amgen's balance sheet shows high leverage with a debt-to-equity ratio of 6.31, but it generates substantial free cash flow (TTM $8.597 billion). The current ratio of 1.14 indicates adequate liquidity, and ROE is an impressive 89.1%, though this is amplified by high leverage. Free cash flow yield (FCF/price) is approximately 4.9%, providing a cushion for debt servicing and dividends.
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?
Since net income is positive, the primary valuation metric is the P/E ratio. The trailing P/E is 22.8x, while the forward P/E is 16.0x, implying the market expects earnings growth of about 42% over the next year. This gap suggests optimistic growth expectations, likely driven by pipeline progress and margin expansion. Compared to the industry average (Drug Manufacturers - General), Amgen's trailing P/E of 22.8x is at a premium to the sector median of approximately 15x, a 52% premium. However, its PEG ratio of 0.26 indicates that the stock is cheap relative to its expected earnings growth, suggesting the premium may be justified by superior growth prospects. Historically, Amgen's trailing P/E has ranged from 11.4x (Q1 2023) to 75.2x (Q2 2021). The current 22.8x is near the lower end of its 5-year range, implying the stock is not overvalued by historical standards. This suggests the market is pricing in reasonable expectations, and there is potential for multiple expansion if growth accelerates.
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 & Operational Risks: Amgen's high debt-to-equity ratio of 6.31 is a significant financial risk, stemming largely from the Horizon Therapeutics acquisition. While TTM free cash flow of $8.597B provides coverage, interest expenses of $657M in Q1 2026 consume a notable portion of operating income. Net margin has fluctuated between 13.5% and 33.7% over the past year, indicating earnings volatility. Revenue concentration is moderate, with top drugs like Prolia ($1.054B) and Otezla ($625M) contributing meaningfully, but no single drug dominates. The company's ability to sustain growth depends on successful pipeline execution, as legacy drugs face biosimilar competition.
Market & Competitive Risks: Amgen trades at a trailing P/E of 22.8x, a 52% premium to the industry median of ~15x, making it vulnerable to valuation compression if growth disappoints. With a beta of 0.40, the stock is less correlated to the market, but macro risks like the proposed 100% drug tariffs could disrupt supply chains and pricing. Competitive threats include biosimilars to Enbrel and other legacy drugs, as well as pipeline competition from rivals like Eli Lilly and Novo Nordisk. Recent news about Tavneos safety warnings adds regulatory overhang, potentially impacting sales and reputation.
Worst-Case Scenario: In a severe downturn, Amgen could face a perfect storm of regulatory setbacks (e.g., Tavneos withdrawal), patent cliff acceleration, and margin compression from tariff costs. The analyst low target of $215 implies a 42.8% downside from the current price of $376.04, aligning with the 52-week low of $269.77 (28.3% downside). An investor could lose up to 42.8% if the stock falls to $215, driven by earnings disappointment and multiple contraction.
