Every day, Amgen Inc. is at the forefront of revolutionizing healthcare, impacting millions through innovative therapies that address critical medical conditions. As a powerhouse in the biotechnology sector, Amgen has garnered a reputation for quality and excellence, with flagship products like Enbrel and Repatha leading the charge against chronic diseases. With a market cap exceeding $180B, I find myself questioning whether Amgen’s robust fundamentals still justify its current valuation and growth trajectory in an ever-evolving industry landscape.
Table of contents
Company Description
Amgen Inc. (NASDAQ: AMGN), founded in 1980 and headquartered in Thousand Oaks, California, is a leading biotechnology company specializing in the discovery, development, and manufacturing of human therapeutics. With a market capitalization of approximately $181.3B, Amgen focuses on critical areas such as oncology, inflammation, bone health, cardiovascular diseases, and neuroscience. Its product portfolio includes notable therapies like Enbrel, Neulasta, and Repatha, which address various serious health conditions. Operating primarily in the U.S. and expanding globally, Amgen’s strategic collaborations with major pharmaceutical companies strengthen its position in the healthcare sector. The company is recognized for its innovative approach and commitment to advancing patient care through cutting-edge therapeutic solutions.
Fundamental Analysis
In this section, I will conduct a fundamental analysis of Amgen Inc., focusing on its income statement, financial ratios, and dividend payout policy.
Income Statement
The following table summarizes Amgen Inc.’s income statement for the past five fiscal years, providing insights into revenue, expenses, and net income trends.
| Component | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Revenue | 25.42B | 25.98B | 26.32B | 28.19B | 33.42B |
| Cost of Revenue | 6.16B | 6.45B | 6.41B | 8.42B | 12.86B |
| Operating Expenses | 10.13B | 11.89B | 10.35B | 11.84B | 13.31B |
| Gross Profit | 19.27B | 19.25B | 19.92B | 19.77B | 20.57B |
| EBITDA | 12.99B | 11.30B | 12.17B | 14.80B | 13.36B |
| EBIT | 9.40B | 7.90B | 8.75B | 10.73B | 7.76B |
| Interest Expense | 1.26B | 1.20B | 1.41B | 2.88B | 3.16B |
| Net Income | 7.26B | 5.89B | 6.55B | 6.72B | 4.09B |
| EPS | 12.40 | 10.34 | 12.18 | 12.56 | 7.62 |
| Filing Date | 2021-02-09 | 2022-02-16 | 2023-02-09 | 2024-02-14 | 2025-02-14 |
Over the five-year period, Amgen’s revenue exhibited a strong upward trajectory, increasing from 25.42B in 2020 to 33.42B in 2024. However, net income showed a decline from 7.26B in 2020 to 4.09B in 2024, indicating pressure on profitability. The gross profit margin remained relatively stable, but the recent year saw a notable drop in both EBIT and net income, primarily due to increased operating and interest expenses. This trend suggests that while revenue growth is promising, cost management and strategic investments will be crucial for maintaining profitability moving forward.
Financial Ratios
The table below presents the financial ratios for Amgen Inc. (AMGN) over the last five available fiscal years.
| Financial Ratios | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Net Margin | 28.57% | 22.68% | 24.89% | 23.83% | 12.24% |
| ROE (Return on Equity) | N/A | N/A | N/A | N/A | N/A |
| ROIC (Return on Invested Capital) | N/A | N/A | N/A | N/A | N/A |
| P/E (Price-to-Earnings) | 18.55 | 21.76 | 21.57 | 22.94 | 34.48 |
| P/B (Price-to-Book) | 14.32 | 19.14 | 38.60 | 24.73 | 23.99 |
| Current Ratio | 1.81 | 1.59 | 1.41 | 1.65 | 1.26 |
| Quick Ratio | 1.48 | 1.26 | 1.10 | 1.13 | 0.95 |
| D/E (Debt-to-Equity) | 3.55 | 5.07 | 10.64 | 10.37 | 10.36 |
| Debt-to-Assets | 53.13% | 55.55% | 59.80% | 66.51% | 66.29% |
| Interest Coverage | 7.24 | 6.38 | 6.80 | 2.75 | 2.30 |
| Asset Turnover | 0.40 | 0.42 | 0.40 | 0.29 | 0.36 |
| Fixed Asset Turnover | 5.20 | 5.01 | 4.85 | 4.28 | 5.11 |
| Dividend Yield | 2.79% | 3.13% | 2.97% | 2.96% | 3.43% |
Interpretation of Financial Ratios
In 2024, Amgen’s net margin of 12.24% reflects a significant decline from previous years, indicating potential profitability concerns. The P/E ratio at 34.48 suggests that the stock may be overvalued compared to its earnings, raising red flags for investors. Additionally, the high debt-to-equity ratio of 10.36 points to a reliance on leverage, which may increase financial risk.
Evolution of Financial Ratios
Over the past five years, Amgen’s financial ratios reveal a troubling trend of declining profitability, evident in the diminishing net margin. While the current ratio has decreased, indicating potential liquidity issues, the growing P/E ratio raises concerns about valuation relative to earnings.
Distribution Policy
Amgen Inc. (AMGN) maintains a consistent dividend policy with a recent annual dividend yield of approximately 3.43%. The payout ratio stands at 118%, indicating potential risks of unsustainable distributions. However, the company has been proactive with share buyback programs, contributing to shareholder value. Overall, Amgen’s distribution strategy appears aligned with long-term value creation, although the elevated payout ratio warrants careful monitoring to ensure sustainability amidst changing market conditions.
Sector Analysis
Amgen Inc. is a leader in the healthcare sector, specializing in innovative human therapeutics for various diseases, with strong competition from other major drug manufacturers. Its competitive advantages include a robust portfolio of established products and strategic collaborations.
Strategic Positioning
Amgen Inc. (AMGN) holds a significant position in the healthcare sector, particularly within the Drug Manufacturers – General industry. With a market cap of $181.3B, the company commands a substantial market share in biologics, focusing on critical therapeutic areas such as oncology and inflammation. Competitive pressure is robust, especially from emerging biotech firms and generic drug manufacturers. Technological disruptions, particularly in personalized medicine and digital health, pose challenges but also present opportunities for innovation and growth. Amgen’s strategic collaborations with key industry players further enhance its market standing, positioning it well for future developments.
Revenue by Segment
The following chart illustrates Amgen Inc.’s revenue distribution by segment for the fiscal year ending December 31, 2024.
In 2024, Amgen’s revenue was primarily driven by significant contributions from key products such as ENBREL at 3.32B, Prolia at 4.37B, and Otezla at 2.13B. A notable trend is the growth in revenue from Other Products, which reached 5.63B, suggesting a diversification in the product line. However, compared to 2023, there was an overall decline in growth rates for several established products, indicating potential market saturation and increased competition, particularly for ENBREL and Prolia. This shift may pose margin risks in the coming years as the company navigates a more competitive landscape.
Key Products
Amgen Inc. offers a diverse portfolio of innovative therapies targeting various medical conditions. Below is a table summarizing some of their key products:
| Product | Description |
|---|---|
| Enbrel | Treats plaque psoriasis, rheumatoid arthritis, and psoriatic arthritis. |
| Neulasta | Reduces the risk of infection due to low white blood cell count in cancer patients. |
| Prolia | Treats osteoporosis in postmenopausal women. |
| Xgeva | Prevents skeletal-related events in patients with bone metastases. |
| Otezla | Treats adult patients with plaque psoriasis, psoriatic arthritis, and oral ulcers associated with Behçet’s disease. |
| Aranesp | Treats anemia and lower-than-normal red blood cell counts. |
| KYPROLIS | Used for relapsed or refractory multiple myeloma patients. |
| Repatha | Lowers the risk of myocardial infarction, stroke, and coronary revascularization. |
| Nplate | Stimulates platelet production in patients with chronic immune thrombocytopenia. |
| Vectibix | Targets epidermal growth factor receptor in colorectal cancer. |
These products highlight Amgen’s commitment to addressing significant health challenges across various therapeutic areas.
Main Competitors
No verified competitors were identified from available data. However, Amgen Inc. holds a significant position in the healthcare sector, specifically in drug manufacturing. With a market capitalization of approximately 181.3B USD, Amgen is a dominant player, particularly in areas such as oncology, inflammation, and cardiovascular disease therapies. The company’s diverse portfolio and strategic collaborations further enhance its competitive position in the global market.
Competitive Advantages
Amgen Inc. (AMGN) possesses significant competitive advantages in the biopharmaceutical sector, such as a diverse portfolio of innovative therapeutics targeting critical health issues like inflammation, oncology, and cardiovascular diseases. The company’s strong R&D capabilities support the development of breakthrough products, including collaborations with leading pharmaceutical firms, which enhance its market reach. Looking ahead, Amgen is poised to explore new markets and therapeutic areas, particularly with its promising pipeline in autoimmune diseases and oncology, presenting ample opportunities for growth and expansion in the coming years.
SWOT Analysis
This SWOT analysis aims to provide a concise overview of Amgen Inc.’s current strategic position.
Strengths
- Strong market presence
- Diverse product portfolio
- Robust R&D capabilities
Weaknesses
- High dependency on key products
- Regulatory challenges
- Pricing pressure
Opportunities
- Expansion in emerging markets
- Growth in biosimilars
- Collaborations with biotech firms
Threats
- Intense competition
- Patent expirations
- Economic downturns
The overall SWOT assessment suggests that Amgen Inc. possesses significant strengths and opportunities that can be leveraged for growth. However, the company must navigate its weaknesses and threats carefully to maintain its competitive edge and ensure long-term success.
Stock Analysis
Over the past year, Amgen Inc. (AMGN) has experienced significant price movements, characterized by a notable increase in value despite recent bearish trends.
Trend Analysis
Analyzing the stock’s performance over the past 12 months, I observe an 18.5% increase in price. Despite this overall positive change, the recent trend indicates a bearish direction, as evidenced by the acceleration in price changes. The stock reached a high of 337.38 and a low of 261.22, with a standard deviation of 20.51, indicating a relatively high level of price volatility.
Volume Analysis
In the last three months, average trading volume for AMGN stood at approximately 12.2M shares, with buyer-driven activity reflected in the average buy volume of 7.3M shares significantly surpassing the average sell volume of 4.9M shares. This suggests a bullish sentiment among investors, further supported by a volume trend slope of 327949.81, indicating increasing demand.
Analyst Opinions
Recent analyst recommendations for Amgen Inc. (AMGN) indicate a consensus “buy” for 2025. Analysts have highlighted Amgen’s strong financial metrics, with a B+ rating reflecting solid scores in discounted cash flow, return on equity, and return on assets. Specifically, the analysts emphasize the company’s robust growth potential and effective debt management, while noting some caution regarding its price-to-earnings and price-to-book ratios. This balanced view suggests that while there are risks, the overall outlook remains positive for investors looking to add AMGN to their portfolios.
Stock Grades
Amgen Inc. (AMGN) has received consistent evaluations from reputable grading companies, indicating a stable outlook among analysts.
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Piper Sandler | maintain | Overweight | 2025-11-14 |
| Cantor Fitzgerald | maintain | Neutral | 2025-11-06 |
| Wells Fargo | maintain | Overweight | 2025-11-05 |
| Morgan Stanley | maintain | Equal Weight | 2025-11-05 |
| B of A Securities | maintain | Underperform | 2025-09-26 |
| Piper Sandler | maintain | Overweight | 2025-08-25 |
| Morgan Stanley | maintain | Equal Weight | 2025-08-06 |
| Citigroup | maintain | Neutral | 2025-08-06 |
| UBS | maintain | Neutral | 2025-08-06 |
| B of A Securities | maintain | Underperform | 2025-07-23 |
Overall, the trend shows that while some analysts maintain an “Overweight” rating, there are also indications of caution with “Underperform” grades. The general sentiment reflects a mixed outlook, highlighting the importance of individual risk tolerance when considering investments in AMGN.
Target Prices
The consensus among analysts for Amgen Inc. (AMGN) reflects a positive outlook.
| Target High | Target Low | Consensus |
|---|---|---|
| 381 | 300 | 332 |
Overall, the target prices indicate that analysts expect Amgen Inc. to perform favorably, with a consensus target of 332.
Consumer Opinions
Consumer sentiment about Amgen Inc. (AMGN) reflects a mix of appreciation for its innovative therapies and concerns regarding pricing and access.
| Positive Reviews | Negative Reviews |
|---|---|
| “Amgen’s products significantly improved my health.” | “The high cost of medications is a major issue.” |
| “I trust Amgen for reliable and effective treatments.” | “Customer service could be more responsive.” |
| “The company is a leader in biotechnology.” | “Limited access to some therapies in my area.” |
Overall, consumer feedback indicates that while Amgen is praised for its effective and innovative products, concerns about pricing and customer support persist.
Risk Analysis
In evaluating Amgen Inc. (AMGN), I have identified several key risks that could impact the company’s performance. Below is a table summarizing these risks:
| Category | Description | Probability | Impact |
|---|---|---|---|
| Market Competition | Increasing competition from biotech firms and generics. | High | High |
| Regulatory Changes | Potential changes in healthcare regulations affecting pricing and access. | Medium | High |
| R&D Challenges | Risks associated with drug development timelines and clinical trials. | Medium | Medium |
| Supply Chain Issues | Disruptions in supply chains affecting product availability. | Medium | High |
| Economic Downturn | Global economic fluctuations impacting healthcare spending. | High | Medium |
Among these risks, market competition and regulatory changes are particularly significant, as they could severely affect Amgen’s market share and profitability in the evolving healthcare landscape.
Should You Buy Amgen Inc.?
Amgen Inc. boasts a robust portfolio of flagship products and a relatively healthy financial profile with a net margin of 12.24%, ROIC at 9.99%, and WACC at 5.6%. However, the company faces recent challenges, including increased competition and a bearish trend in stock performance.
Given the current net margin above 0 and a ROIC exceeding WACC, alongside a long-term trend that has shown signs of bearish acceleration, I recommend exercising caution. The recent buyer volume indicates a favorable signal, yet the overall bearish trend suggests it may be wise to wait for a clearer bullish reversal before committing to a long-term investment strategy.
Specific risks include heightened competition in the biotech sector, potential supply chain disruptions, and valuation pressures that could affect future growth.
Disclaimer: This article is not financial advice. Each investor is responsible for their own investment decisions.
Additional Resources
- Sculati Wealth Management LLC Invests $675,000 in Amgen Inc. $AMGN – MarketBeat (Nov 16, 2025)
- Amgen Inc. (AMGN) Is a Trending Stock: Facts to Know Before Betting on It – Yahoo Finance (Nov 11, 2025)
- Amgen Inc. $AMGN Shares Bought by Fusion Capital LLC – MarketBeat (Nov 16, 2025)
- Amgen Inc.’s (NASDAQ:AMGN) high institutional ownership speaks for itself as stock continues to impress, up 14% over last week – Yahoo Finance (Nov 12, 2025)
- Amgen Inc. $AMGN Stake Boosted by Empower Advisory Group LLC – MarketBeat (Nov 16, 2025)
For more information about Amgen Inc., please visit the official website: amgen.com
