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Alvotech (NasdaqGM:ALVO): Assessing Valuation After European Approval of Denosumab Biosimilar AVT03

Simply Wall St · 2d ago

The latest move in Alvotech (NasdaqGM:ALVO) is being driven by a major regulatory win: European Commission approval of its denosumab biosimilar AVT03, opening the door to a sizeable osteoporosis and oncology market.

See our latest analysis for Alvotech.

The AVT03 approval has clearly sparked a rebound in sentiment, with a 1 day share price return of 7.89 percent and 30 day share price return of 12.09 percent. However, the 1 year total shareholder return of negative 52.06 percent shows investors are still weighing past setbacks and regulatory risks, so momentum is stabilising rather than fully turning yet.

If this kind of healthcare catalyst has your attention, it could be a good moment to explore healthcare stocks for other treatment focused names with interesting risk reward profiles.

Yet with the stock down more than 50 percent over the past year but trading at a steep discount to analyst targets and intrinsic value estimates, is this a contrarian entry point, or is the market already discounting future growth?

Most Popular Narrative: 79.3% Undervalued

With the narrative fair value of $26.40 set far above Alvotech's last close at $5.47, the valuation case leans heavily on ambitious growth and margin expansion.

Ongoing launch and approval pipeline activity, including upcoming regulatory decisions in major global markets (for AVT03, AVT05, AVT23, and others), positions the company to tap into blockbuster biologic markets coming off patent, potentially driving a step change in topline revenue once approvals are secured.

Read the complete narrative.

Curious how this valuation turns a loss making past into a high margin future giant? The narrative leans on aggressive revenue scaling and richer profitability, backed by a discount rate that still assumes execution success. Want to see which specific growth runway and earnings profile are baked into that upside story? Read on and unpack the full set of assumptions behind this fair value path.

Result: Fair Value of $26.40 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, lingering FDA manufacturing concerns and reliance on lumpy milestone payments still threaten the smooth revenue ramp that this valuation narrative assumes.

Find out about the key risks to this Alvotech narrative.

Build Your Own Alvotech Narrative

If you see the story differently or want to dig into the numbers yourself, you can build a custom view in minutes: Do it your way.

A great starting point for your Alvotech research is our analysis highlighting 3 key rewards and 4 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.