Alkermes plc Ordinary Shares (ALKS)

FairStock Score: 42/100 — MIXED

Key Financials

Strengths

• Solid return on equity of 14.7% above cost of capital
• Conservative balance sheet with debt-to-equity of just 0.04, providing financial flexibility
• Altman Z-Score of 5.6 confirms minimal bankruptcy risk and strong solvency

Concerns

• Trades significantly above Graham Number ($19) with negative 81% margin of safety—limited downside protection
• Revenue declining at 10.6% year-over-year signals potential demand weakness or market share loss

AI Analysis

Alkermes plc Ordinary Shares is a small-cap healthcare company valued at $5.7 billion. The business generates $1.5 billion in annual revenue with a 3.3% net margin. From a quality standpoint, Alkermes shows Altman Z-Score of 5.6 confirms fortress-level solvency and adequate 15% ROE. On valuation, the stock is reasonably priced at 23.7x earnings, with trades above its Graham Number with a negative 81% margin. Growth dynamics show revenue growing at -10.6% and profit growth of -66.3%. Our composite FairStock Score of 42/100 reflects below-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

Improving fundamentals and sector tailwinds could drive meaningful earnings growth, compressing the effective multiple for patient investors. Operational leverage in the business model means incremental revenue growth could disproportionately boost bottom-line profitability.

Bear Case

Macro headwinds or sector-specific disruption could pressure margins, particularly if competitive intensity increases in the healthcare space. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer