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Sitting at a market capitalization of $159 billion, Amgen (AMGN) is a biotech powerhouse. Founded in 1980, it is one of the biggest names in the healthcare and biotech industry, with a strong history of innovation, consistent revenue generation, and a generous dividend. The company offers a forward dividend yield of 3.25%, significantly above the healthcare sector's 1.6% average, making it an attractive option for income-focused investors seeking stability.
Amgen specializes in oncology, cardiovascular disease, inflammation, and rare conditions. Some of its blockbuster drugs include Enbrel (for rheumatoid arthritis), Prolia (for osteoporosis in women), Repatha (for cholesterol management), Otezla (for psoriasis treatment), and Kyprolis (for multiple myeloma). The company delivered strong quarterly results, closing out 2024 on a high note. Despite a 12.5% gain year-to-date, the stock remains more than 14% below its 52-week high.
Let’s take a closer look at Amgen’s fourth-quarter performance to assess whether this dip presents a solid buying opportunity.
Is Amgen in Good Financial Shape?
A stock’s strength depends on the company behind it, and Amgen has demonstrated consistent revenue growth. In the fourth quarter, the company reported strong performance, with product sales rising 11% year-over-year and total revenue hitting $9.1 billion.
For the full year, total revenue increased 19% to $33.4 billion. Ten of its products posted double-digit growth, led by Repatha, EVENITY, TEZSPIRE, BLINCYTO, and TAVNEOS. Notably, Repatha sales grew 36% to $2.2 billion, driven by 54% volume growth in the U.S. EVENITY revenue climbed 35% to $1.5 billion, benefiting from increased prescriptions. Amgen’s rare disease segment brought in over $4.5 billion, with TEPEZA contributing $1.9 billion. In the inflammation category, TEZSPIRE sales jumped 71% year-over-year to nearly $1 billion.
Oncology sales totaled $8 billion, bolstered by a 41% increase in BLINCYTO revenue and a strong launch of IMDELLTRA for small cell lung cancer. Biosimilar sales reached $2.2 billion, marking 16% year-over-year growth, with the successful introduction of PAVBLU (an EYLEA biosimilar) and WEZLANA (a STELARA biosimilar). As lower-cost alternatives to expensive biologic drugs, biosimilars represent a major growth avenue for the company. Amgen has been aggressively expanding in this space, which could help counteract revenue declines from older drugs nearing patent expiration.
What’s more, to compete with Eli Lilly (LLY) and Novo Nordisk (NVO), Amgen has entered the obesity drug market with its anti-obesity candidate, MariTide. The drug has attracted significant interest due to its ability to sustain weight loss with fewer injections compared to rivals. MariTide is currently in the second phase of its Phase 2 trial and could advance to Phase 3 in 2025. It is also being studied in a separate Phase 2 trial for Type 2 diabetes treatment. However, the U.S. Food and Drug Administration (FDA) has placed a clinical hold on its other obesity drug candidate, AMG 513, which was in Phase 1 trial. While no more details were disclosed, management stated the company is in talks with the FDA to reopen the trial.
Beyond MariTide, Amgen has multiple Phase 3 trials underway, including Dazodalibep for renal transplant rejection, TEZSPIRE for asthma, UPLIZNA for rare diseases, and Rocatinlimab for moderate-to-severe atopic dermatitis, along with various oncology studies set for this year. The company invested $1.6 billion in research and development (R&D) during the quarter. Adjusted earnings grew 13% in Q4 and 6% for the full year. Amgen also generated $4.4 billion in free cash flow in Q4, supporting its steady dividend payments. In fact, it raised its dividend by 6% to $2.25 per share. The company’s forward payout ratio of 44% is also sustainable.
At the end of 2024, Amgen held $12 billion in cash and investments, with $60.1 billion in debt, mainly from acquisitions. However, the company has maintained solid financial management, ensuring strong cash flow to cover debt obligations and return capital to shareholders. Investors should monitor Amgen’s R&D spending and how effectively it translates into blockbuster drugs. Management noted in the Q4 earnings call that five Phase 3 studies were completed in 2024, with multiple data readouts expected in 2025.
2025 Guidance and AMGN Stock Valuation
Looking ahead to 2025, Amgen projects revenue between $34.3 billion and $35.7 billion, with adjusted earnings per share ranging from $20 to $21.2 per share — aligning with analysts’ expectations.
The stock trades at 14 times forward earnings, making it a reasonable buy at current levels. Looking further ahead, Amgen expects steady revenue growth through 2030, driven by strong execution, an expanding drug pipeline, and AI-driven efficiencies. The company is also scaling up its manufacturing capabilities to support its growing portfolio.
Is Amgen Stock a Buy or Sell on Wall Street?
Overall, AMGN stock is a “Moderate Buy.” Out of the 30 analysts covering the stock, 14 rate it a “Strong Buy,” one rates it a “Moderate Buy,” 12 suggest a "Hold,” one says it is a “Moderate Sell,” and two recommend a “Strong Sell.” The stock’s average price target of $319 implies 7.5% upside over the next 12 months, while the highest target of $389 represents a potential gain of 31.1% from current levels.
Key Takeaway
Amgen is poised for solid growth in 2025 and beyond, driven by its blockbuster drugs, strong pipeline, and AI-enhanced efficiencies, strengthening its position in the cardiovascular, oncology, inflammation, and rare disease markets. If you’re looking for a dividend-paying biotech stock with steady (if not explosive) growth, Amgen could be a valuable addition to a long-term portfolio. With a proven track record of delivering shareholder value, it remains a strong, well-established company.
