Alnylam's Sell-Off Looks Ugly -- but Wall Street Still Sees a Much Brighter Picture
Key Points
Analysts remain bullish about Alnylam despite its steep sell-off.
The competitive landscape for Alnylam is more promising now thanks to two recent developments.
Alnylam's valuation makes its risk-reward proposition look appealing.
There's no way to spin Alnylam Pharmaceuticals' (NASDAQ: ALNY) stock performance in 2026 in a positive light. It's been downright ugly. Alnylam's share price plunged more than 50% year-to-date earlier this summer and remains around 40% below its peak.
You might think that most Wall Street analysts would have thrown in the towel on Alnylam. However, that isn't the case at all. Instead, analysts remain overwhelmingly bullish about the biotech stock.
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Of the 29 analysts surveyed by S&P Global (NYSE: SPGI) in September, 22 rated Alnylam as a "buy" or "strong buy." The seven other analysts recommended holding the stock. The average 12-month price target for the stock reflects a potential upside of roughly 50%. Why does Wall Street still see a much brighter future for Alnylam?
The bull case for Alnylam
Analysts aren't ignoring Alnylam's revenue guidance cut in the second quarter of 2026. However, they appear to view the resulting sell-off as way overdone. I think there are three main reasons why.
First, Alnylam's revenue continues to grow robustly despite the reduced outlook. The drugmaker's revenue soared 72% year over year in Q2 and is still expected to increase by 75% year over year in full-year 2026.
Image source: Getty Images.
Second, Pfizer's (NYSE: PFE) Vyndaqel/Vyndamax franchise, which targets the same transthyretin amyloid cardiomyopathy (ATTR-CM) indication as Alnylam's Amvuttra, won't face a generic rival in the U.S. until mid-2031. This should give Amvuttra a clearer growth runway over the next five years.
Third, AstraZeneca's (NYSE: AZN) disappointing late-stage clinical results for Wainua (eplontersen) in treating patients with ATTR-CM could be good news for Alnylam's prospects for its experimental therapy, nucresiran. Sure, both Wainua and nucresiran silence genes. However, nucresiran uses a different mechanism of action.
Alnylam's management team sounds more confident about their chances of success now with a potentially formidable rival out of the picture. The company continues to project a commercial launch of nucresiran to treat transthyretin amyloid polyneuropathy (ATTR-PN) by 2028 and an ATTR-CM launch by 2030.
A good risk-reward proposition
I doubt that many investors would view Alnylam as a bona fide value stock. However, there's a pretty good case to be made that this drugmaker is priced at a bargain after its steep decline this year.
Alnylam's shares currently trade at roughly 6.8 times projected 2026 sales and 19.5 times forward earnings. But the company's price-to-earnings-to-growth (PEG) ratio, which factors in analysts' five-year growth estimates, is a super-low 0.32.
Granted, those growth expectations depend on Alnylam achieving success with nucresiran. It's possible that it won't happen. However, Wall Street thinks that Alnylam offers a good risk-reward proposition. I agree.
Keith Speights has positions in Pfizer. The Motley Fool has positions in and recommends Alnylam Pharmaceuticals, AstraZeneca Plc, Pfizer, and S&P Global. The Motley Fool has a disclosure policy.