Amgen Rises Almost 22% YTD: Should You Buy, Hold or Sell the Stock?

Amgen’s AMGN stock has risen 21.7% so far this year compared with an increase of 7% for the industry.AMGN Stock PerformanceImage Source: Zacks Investment ResearchAmgen’s stock has been rising consistently, with corrections in between due to pipeline setbacks. Amgen’s key medicines, like Evenity and Repatha, newer medicines like Tavneos and Tezspire and rare disease drugs, mostly products added from the Horizon acquisition, are driving sales. Its total revenues rose 19% in 2024 to $33.4 billion. Amgen expects key drugs like Repatha, Evenity, Tezspire and oncology and rare disease drugs, as well as biosimilars to drive top-line growth in 2025.Amgen also has some key pipeline assets in obesity and inflammation, which have a large market opportunity.However, increased pricing headwinds and competitive pressure are hurting sales of many products. Weakness in some key brands, like Otezla and Lumakras, creates potential revenue headwinds. Sales of best-selling drugs, Prolia and Xgeva, are expected to decline in 2025 due to biosimilar competition.Let’s understand these factors in detail to better analyze how to play the stock.Key Drugs Driving AMGN’s Top LineAmgen is seeing declining revenues from oncology biosimilars and some legacy established products like Enbrel. Pricing headwinds and competitive pressure are hurting sales of many products. Sales of some key brands, like Otezla and Lumakras, have been lukewarm. However, revenues from key older medicines like Prolia, Repatha and Blincyto and new drugs like Tavneos and Tezspire are driving the top line. Rare disease drugs like Tepezza, Krystexxa and Uplizna, added from last year’s acquisition of Horizon Therapeutics, are also boosting top-line growth.Amgen is also evaluating Kyprolis, Otezla, Nplate, Repatha, Lumakras, Tezspire, Uplizna and Blincyto for additional indications. Approval for expanded use of these drugs can potentially drive further top-line growth. Amgen plans to file regulatory applications for Uplizna in myasthenia gravis in the first half of 2025, while an application for IgG4-related disease is under priority review, with the FDA decision expected on April 3, 2025.AMGN’s Interesting PipelineAmgen has invested several billion dollars in M&A deals over the last decade, which has bolstered its product portfolio and diversified its pipeline.Amgen is developing MariTide, a GIPR/GLP-1 receptor, as a single dose in a convenient autoinjector device with a monthly and maybe less frequent dosing. This key feature differentiates it from Eli Lilly’s LLY and Novo Nordisk’s NVO popular GLP-1-based obesity drugs, Zepbound and Wegovy, which are weekly injections.Based on the encouraging data from the phase II study, Amgen expects to launch the phase III MARITIME study on MariTide across obesity, obesity-related conditions and type-II diabetes, with the first studies to begin in the first half of 2025. Amgen expects data readouts from the ongoing phase II study in type II diabetes and part II of the ongoing phase II study in obesity in the second half of 2025.Amgen also has some preclinical obesity candidates in its pipeline, including oral and injectable approaches comprising both incretin and non-incretin mechanisms.An interesting BiTE drug, Imdelltra (tarlatamab), was approved for pre-treated advanced small cell lung cancer (ES-SCLC) in May 2024. Several phase III studies are currently ongoing on tarlatamab in earlier-line settings across extensive-stage and limited-stage SCLC. Imdelltra is believed to have blockbuster potential, as there are limited treatment options in late-line SCLC. Another important candidate, rocatinlimab is being evaluated in phase III studies for atopic dermatitis and prurigo nodularis.Several data readouts are expected over the next six to 12 months, which could be important catalysts for the stock.AMGN’s Strong Biosimilars PortfolioAmgen boasts a strong biosimilars portfolio. Amgen markets Kanjinti (a biosimilar of Roche’s Herceptin), Mvasi (biosimilar of Roche’s Avastin) and Amjevita/Amgevita [biosimilar of AbbVie’s ABBV Humira] in the United States and EU. In 2024, Amgen recorded $2.2 billion in sales from its biosimilar products, rising 16% year over year.Amgen has developed biosimilars of J&J’s Stelara (Wezlana/ABP 654), Alexion’s Soliris (Bekemv/ABP 959) and Regeneron’s Eylea (ABP 938). Wezlana was approved in 2023 and launched in January 2025. Bekemv was approved in the United States in May 2024 and is expected to be launched in the second quarter of 2025. Pavblu (ABP 938) was launched in the fourth quarter of 2024. These new products should further boost biosimilars sales in 2025.AMGN’s Obesity Pipeline Faces SetbacksAmgen has faced some recent setbacks in its obesity pipeline.Amgen began a phase I study on one of these candidates, AMG 513, for obesity in the third quarter. In February, the FDA put a clinical hold on a phase I study on its obesity candidate, AMG 513.In November 2024, Amgen announced the much-awaited 52-week top-line data from a phase II study on MariTide,  which is being developed to treat obesity. The data from the double-blind dose-ranging study showed that in people who were obese or overweight but without type II diabetes, MariTide resulted in up to approximately 20% average weight loss over 52 weeks without reaching a weight loss plateau. However, the weight loss reduction was at the lower end of investor expectations of 20-25%.AMGN’s Key Drugs Prolia/Xgeva Lose ExclusivityPatents for Amgen’s RANKL antibodies (including sequences), Prolia and Xgeva expired in February 2025 in the United States and will expire in November 2025 in some European countries. Sales of these best-selling drugs are expected to erode significantly in 2025 due to patent erosion.AMGN’s Valuation & EstimatesFrom a valuation standpoint, Amgen is not very cheap. Going by the price/earnings ratio, the company’s shares currently trade at 15.26 forward earnings, just slightly lower than 16.85 for the industry. The stock is also trading above its five-year mean of 13.83.AMGN Stock ValuationImage Source: Zacks Investment ResearchThe Zacks Consensus Estimate for earnings has risen from $20.36 to $20.63 per share for 2025 over the past 60 days. For 2026, the consensus mark for earnings has risen from $20.85 to $21.34 per share over the same timeframe.AMGN’s Estimate MovementImage Source: Zacks Investment ResearchStay Invested in AMGN StockAfter analyzing the factors discussed above, we believe the company is well placed on maintaining long-term revenue growth, driven by continued strong volume growth of key drugs, Repatha, Evenity and Prolia and increasing contribution from new innovative medicines like Tezspire, Tavneos and Imdelltra. It is expected to see continued clinical success from its mid- to late-stage pipeline. Though the recent data were below expectations, MariTide has the potential to be a game-changer for Amgen.All these factors, along with the consistently rising estimates, are good enough reasons for those who own this Zacks Rank #3 (Hold) stock to stay invested for now. 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