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    Amgen (AMGN) Stock Could Be 40% Undervalued On Phase 3 Sjögren’s Data

    Simply Wall St·09/24/2026 12:27:58
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    Amgen has delivered a strong run over the past several years and now trades near US$406, which naturally raises the question of whether that price is fully supported by the cash the business can generate. Recent drug pipeline progress and product updates add more moving parts to the story, so the market is effectively being asked to put a number on those future cash flows today.

    • Over the past 5 years, Amgen has returned 120.8%, putting a lot of investor capital on the line if the current share price and the company’s long term cash generation eventually pull in different directions.
    • Positive Phase 3 data for dazodalibep in systemic Sjögren’s disease and an FDA change that may widen access to IMDELLTRA can influence how investors think about future revenue durability, development spending, and the timing of potential cash inflows.
    • Prefer to judge Amgen on earnings? See what Amgen's 25.1x P/E says about the price.

    The issue now is whether Amgen’s current share price is adequately backed by its projected cash flows when measured against an intrinsic value estimate built from those cash streams.

    If you are weighing whether Amgen's US$406 share price is fully supported by its future cash flows, a focused stock screen is another useful starting point for research via 30 high quality undervalued stocks

    Is Amgen Still Cheap on Cash Flow?

    The Discounted Cash Flow (DCF) model here is built on Amgen’s ability to keep turning its drug portfolio into sizeable free cash generation. Over the last twelve months, the business produced about $10.8b of free cash flow, and the projections used in the model assume those cash flows continue growing rather than shrinking. That growth profile, combined with the current share price of $406.09, is what creates the gap between the DCF estimate and where the market is trading today.

    Forecast free cash flows step up into the $14b to $21b range over the next decade in the model, which is more consistent with a mature but expanding pharmaceutical franchise than with a distressed asset. The DCF outcome still comes out substantially above $406.09, which implies that investors are applying a heavier discount to Amgen’s long term cash stream than the model does. Because the positive Phase 3 dazodalibep data could support longer term cash flow resilience if it converts into an approved product, that caution in the current pricing helps explain why the DCF result points higher than the market. Find out what Amgen could be worth using our Discounted Cash Flow (DCF) estimate.

    The Amgen Narrative: What Would Justify Today's Price?

    Simply Wall St Narratives for Amgen pick up where the DCF puzzle leaves off. Narratives set out the specific assumptions about Amgen's future growth, margins and earnings that would need to hold for the valuation to sit meaningfully above or below today's share price. Where a single ratio or model gives you one number, they spell out the future that number relies on so you can watch how reality lines up with it over time on the Community page.

    Community views on Amgen split between a broad, cash generative pipeline story and a more cautious read on obesity hype and legacy erosion.

    Bull case: 11% undervalued

    "Expanding product volumes and AI-driven R&D advancements position Amgen to exceed revenue and margin expectations through frequent, high-impact new launches across key therapeutic areas..."

    Discover why this Narrative puts Amgen at 11% undervalued.

    Bear case: 13% overvalued

    "MariTide's commercial ramp-up will take years post-launch, while Amgen’s high-margin legacy moats are already eroding at a brutal 30%+ YoY clip right now..."

    Explore why this Narrative puts Amgen at 13% overvalued.

    One more Amgen check investors should look at before leaning on the valuation

    Amgen’s cash story is only half the picture, because Simply Wall St’s broader checks have also flagged specific risk signals that deserve a closer look before you lean on any valuation output. Take a closer look at 1 warning sign before settling on a valuation.

    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.