AMGN Up Almost 16% in a Month: Should You Buy, Sell or Hold the Stock?

Core Insights - Amgen's stock has increased nearly 16% in one month due to strong Q3 2025 results, with both revenue and earnings surpassing expectations, and the company has raised its sales guidance for the year [1][10] - The drug and biotech sector has shown recovery, with major companies like Pfizer and AstraZeneca entering pricing agreements with the Trump administration, which may lead to a sustainable sector recovery [2][3] Financial Performance - Amgen's revenues grew by 10.5% in the first nine months of 2025, driven by strong demand for its innovative medicines [4] - Key drugs such as Repatha, Evenity, and new products like Tavneos and Tezspire are significantly contributing to revenue growth, alongside biosimilars [5][7] - Biosimilars generated approximately $2.2 billion in sales in the first nine months of 2025, with annualized sales expected to reach around $3 billion [17] Product Pipeline - Amgen is focusing on expanding the indications for several key drugs, which could further enhance revenue growth [6][7] - The company is developing MariTide, an obesity treatment, which has shown promising results in clinical studies and is expected to differentiate itself from competitors [8][9][11] - Ongoing phase III studies for MariTide and other candidates could provide important catalysts for future growth [12][14] Market Position and Valuation - Amgen's stock has outperformed the industry and S&P 500, with a year-to-date increase of 32.5% compared to 17.7% for the industry [22] - The stock is currently trading at a price/earnings ratio of 15.97, which is lower than the industry average of 17.26, indicating reasonable valuation [25] - Consensus estimates for earnings have been revised upward for 2025 and 2026, reflecting positive market sentiment [28][30] Challenges and Competitive Landscape - The expiration of patents for key drugs like Prolia and Xgeva is expected to lead to revenue erosion due to the introduction of biosimilars [19] - Pricing pressures from Medicare Part D redesign and the Inflation Reduction Act may adversely impact sales of certain drugs [20]