Last Update 11 Dec 25

Fair value Increased 2.64%

SRPT: Safety Reviews And Payer Decisions Will Shape Future Risk Reward Balance

Sarepta Therapeutics' fair value estimate has been raised modestly to approximately $20.43 from $19.91, as analysts factor in stronger than expected Elevidys adoption and a more favorable risk or reward profile, despite only incremental improvements in revenue growth and discount rate assumptions.

Analyst Commentary

Street research on Sarepta has turned more constructive at the margin, with multiple models recalibrated around stronger Elevidys uptake and a clearer path to reimbursement. However, the range of ratings and targets indicates that execution on commercial scaling and safety monitoring remains central to the valuation debate.

Bullish Takeaways

Bullish analysts are upgrading ratings and lifting price targets as Q3 results demonstrate that Elevidys demand can outperform even in the face of a temporary commercial pause. This is supporting a higher growth trajectory than previously modeled.
Positive coverage trends and improving payer acceptance are viewed as catalysts for accelerating revenue conversion. This underpins higher fair value estimates and justifies multiple expansion from current levels.
Stronger than expected initial adoption is seen as de-risking the medium-term launch curve, reducing perceived execution risk around manufacturing scale up and patient identification.
At current share levels, bullish analysts argue that the risk or reward profile is skewed favorably, with upside tied to continued Elevidys penetration and potential label or geography expansions.

Bearish Takeaways

Bearish analysts maintain more conservative ratings and only modest target increases, emphasizing that Elevidys momentum is still relatively early and may face volatility from safety surveillance or regulatory scrutiny.
Some models continue to embed discounted long term revenue curves, reflecting caution around durability of treatment effect, competitive gene therapy entrants, and pricing pressure in rare disease markets.
Execution risk remains a key constraint on valuation, with skeptics citing the need for flawless commercial execution, consistent manufacturing performance, and broad payer alignment to justify higher multiples.
Incremental target hikes are framed as largely mechanical updates post Q3 rather than a wholesale rerating. This signals that a portion of the Elevidys upside may already be reflected in current share prices.

What's in the News

New York's Drug Utilization Review Board recommended that state Medicaid pause coverage of Elevidys until updated FDA safety and clinical trial data are added to the label, citing liver risk concerns and awaiting a recommendation on an enhanced risk-mitigation regimen (STAT).
The FDA approved dosing in Cohort 8 of Sarepta's ENDEAVOR Study 9001-103 to evaluate an enhanced immunosuppression regimen with Elevidys in non ambulant DMD patients, as part of efforts to manage risks of acute liver injury and liver failure (company announcement).
Sarepta updated the Elevidys prescribing information with a boxed warning for acute serious liver injury and acute liver failure, removed the non ambulatory indication, and added expanded monitoring and immunosuppression guidance while working with regulators on a path to resume dosing in non ambulant patients (company announcement).
Phase 1 or 2 multiple ascending dose data for SRP-1003 in type 1 myotonic dystrophy supported escalation to higher dose cohorts and triggered a USD 200 million milestone payment to Arrowhead, highlighting progress in Sarepta's next generation siRNA pipeline beyond DMD (company announcement).
Completion of the ESSENCE Phase 3 study for AMONDYS 45 and VYONDYS 53 showed numerically favorable but not statistically significant primary endpoint results overall, with non COVID impacted data and extensive real world evidence supporting Sarepta's plan to seek conversion from accelerated to traditional approvals (company announcement).

Valuation Changes

Fair Value Estimate has risen slightly to approximately $20.43 from about $19.91 per share, reflecting a modest upward revision in intrinsic value.
The discount rate has declined marginally from roughly 8.12 percent to about 7.99 percent, indicating a slightly lower perceived risk profile in the updated model.
Revenue growth has improved modestly, with the long term outlook revised from around minus 16.04 percent to approximately minus 15.74 percent.
Net profit margin has been reduced meaningfully from roughly 13.35 percent to about 11.04 percent, implying a more conservative view on long term profitability.
The future P or E multiple has increased notably from about 16.9x to approximately 20.7x, suggesting higher expected valuation relative to forward earnings.

Addressing operational delays and administrative complexities in gene therapy could enhance revenue by quickly converting demand into treated patients.
Expanding into LGMD and siRNA platforms diversifies revenue, potentially boosting earnings and financial stability.
Safety concerns and administrative delays could impact ELEVIDYS demand and revenue growth, while high research costs pressure profitability amidst cautious market uptake.

Catalysts

About Sarepta Therapeutics

A commercial-stage biopharmaceutical company, focuses on the discovery and development of RNA-targeted therapeutics, gene therapies, and other genetic therapeutic modalities for the treatment of rare diseases.What are the underlying business or industry changes driving this perspective?

Sarepta's ELEVIDYS product has shown significant revenue growth, but due to operational delays and safety concerns, there is room for further patient and physician education which could drive revenue as confidence in the therapy is restored and more families choose to access the treatment.
Administrative complexities in gene therapy, including longer start form to infusion times, can be improved, potentially streamlining processes and enhancing future revenue by more quickly translating demand into treated patients.
Efforts to balance demand across affiliated treatment centers with additional capacity could improve the ability to treat more patients, advancing revenue growth as these centers become more effective and productive in patient throughput.
The scheduled dissemination of additional safety and efficacy data for ELEVIDYS, and anticipated label updates for new patient populations, provides clear pathways to further demonstrate the therapy’s positive risk-benefit, likely enhancing long-term revenue drivers.
Development and commercialization of other programs like the LGMD and siRNA platforms represent additional revenue streams. Expansion within these areas could drive significant future earnings and diversify Sarepta's product portfolio, positively impacting overall financial health.

Sarepta Therapeutics Earnings and Revenue Growth

Sarepta Therapeutics Future Earnings and Revenue Growth

Assumptions

How have these above catalysts been quantified?

Analysts are assuming Sarepta Therapeutics's revenue will decrease by 17.0% annually over the next 3 years.
Analysts assume that profit margins will increase from -2.3% today to 12.1% in 3 years time.
Analysts expect earnings to reach $171.6 million (and earnings per share of $1.07) by about September 2028, up from $-58.0 million today. However, there is a considerable amount of disagreement amongst the analysts with the most bullish expecting $542.6 million in earnings, and the most bearish expecting $-111.3 million.
In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 18.5x on those 2028 earnings, up from -29.9x today. This future PE is greater than the current PE for the US Biotechs industry at 15.3x.
Analysts expect the number of shares outstanding to grow by 2.3% per year for the next 3 years.
To value all of this in today's terms, we will use a discount rate of 7.96%, as per the Simply Wall St company report.

Sarepta Therapeutics Future Earnings Per Share Growth

Risks

What could happen that would invalidate this narrative?

The tragic event of a child's acute liver failure and death following ELEVIDYS infusion could lead to increased scrutiny, cautious patient uptake, and potential regulatory challenges, impacting revenue growth.
Complex and prolonged administrative processes for gene therapy infusions, including issues like single-case agreements, can delay treatments and thus defer revenue recognition.
The dependency on a few top sites with limited capacity, coupled with a significant backlog, creates bottlenecks in patient treatment, thereby affecting the timing of revenue realization.
Safety concerns stemming from the recent patient death may affect physician and patient confidence, influencing demand for ELEVIDYS and potentially impacting earnings.
High upfront costs for research and collaborations, evidenced by the significant expenses with Arrowhead, might pressure net margins and overall profitability in the face of slower than expected revenue recognition.

Valuation

How have all the factors above been brought together to estimate a fair value?

The analysts have a consensus price target of $23.96 for Sarepta Therapeutics based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $80.0, and the most bearish reporting a price target of just $5.0.
In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $1.4 billion, earnings will come to $171.6 million, and it would be trading on a PE ratio of 18.5x, assuming you use a discount rate of 8.0%.
Given the current share price of $17.64, the analyst price target of $23.96 is 26.4% higher.
We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.

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Disclaimer

AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.

SRPT: Upcoming Clinical Data Will Drive Renewed Momentum In Gene Therapy Efforts