Arrowhead Pharmaceuticals (ARWR) opened 2026 with Q1 revenue of US$264.0 million and basic EPS of US$0.22, while trailing twelve month figures show revenue of US$1.1 billion and basic EPS of US$1.48 as the company stayed in profitable territory over the last year. Over recent quarters, revenue has moved from US$2.5 million in Q1 2025 to US$542.7 million in Q2 2025 and US$256.5 million in Q4 2025, with EPS shifting from a loss of US$1.39 per share in Q1 2025 to a profit of US$2.78 per share in Q2 2025 before settling at a small loss of US$0.17 per share in Q4 2025. This highlights a period of sharp earnings swings around the move into profitability. For investors, this latest print frames a company where margins have recently turned positive and now hinge on how consistently that profitability can be maintained.

See our full analysis for Arrowhead Pharmaceuticals.

With the headline numbers on the table, the next step is to see how these results line up with the widely held narratives about Arrowhead Pharmaceuticals and where the fresh data pushes back against those stories.

TTM profit of US$202 million after large losses

• Over the last twelve months, Arrowhead moved from a net loss of US$599.5 million in Q4 2024 to trailing twelve month net income of US$202.3 million on US$1.1b of revenue, with basic EPS shifting from a loss of US$5.00 per share to a profit of US$1.48 per share.
• Consensus narrative talks up a broad RNAi pipeline and global partnerships as long term growth drivers. However, the recent swing from repeated quarterly losses between Q4 2024 and Q1 2025 to positive TTM earnings also highlights how dependent the story has been on a handful of large revenue periods rather than steady product sales so far.
  • For example, quarterly revenue ranged from US$0 in Q4 2024 to US$542.7 million in Q2 2025 before landing at US$264.0 million in Q1 2026, which can make the earnings path look uneven even as the trailing figure turns positive.
  • Investors who focus on the balanced or bullish narratives around long term expansion may want to factor in how this pattern of lumpy revenue has fed directly into big EPS swings from a loss of US$1.39 per share in Q1 2025 to a profit of US$2.78 per share in Q2 2025 and then back to a small loss in Q4 2025.

High P/E of 54x with DCF fair value at US$162.59

• The stock trades on a trailing P/E of about 54x compared with a peer average of roughly 28.5x and a US biotech industry average of about 17.8x, while the supplied DCF fair value of US$162.59 sits well above the current share price of US$77.95.
• Bulls point to the gap between the current price and the DCF fair value as a potential upside signal, but the high P/E relative to peers means the recent move into profitability, with TTM net income of US$202.3 million and EPS of US$1.48, already carries a higher earnings multiple than many other biotech stocks.
  • Supporters of the bullish view who look to long term cash flow potential may see the stock trading about 52.1% below the DCF fair value as an opportunity, even though forecast EPS growth of roughly 2% a year and revenue growth of around 6.2% a year are both slower than the US market figures provided.
  • On the other hand, critics who lean toward the bearish narrative around growth and reimbursement risk may focus on how a 54x P/E compares with the 17.8x industry level while forecasts in the data show slower expected growth than the wider market.

Bulls argue that the recent shift to profitability and large DCF gap could signal mispricing, while others question whether slower expected growth justifies a 54x P/E, so it can be useful to see how the optimistic case connects each of these numbers to future outcomes before making a call on the stock’s risk and reward balance. 🐂 Arrowhead Pharmaceuticals Bull Case

Pipeline expands to 13 Phase I and 4 Phase III programs

• Within the clinical portfolio, products in Phase I increased from 9 in Q1 2025 to 13 in Q1 2026, while Phase III programs moved from 3 to 4 over the same period, alongside trailing twelve month revenue of US$1.1b and net income of US$202.3 million.
• Bears argue that a concentrated RNAi pipeline and reliance on a few key late stage assets heighten revenue risk despite this wider clinical spread, and the earnings history, which includes quarterly net losses of over US$170 million in each quarter from Q4 2024 through Q1 2025, shows how setbacks or delays could again weigh heavily on the income statement.
  • The bearish narrative also flags partner dependence as a possible weak point, which lines up with the data showing that large milestone and collaboration payments have helped drive revenue from US$2.5 million in Q1 2025 to peaks like US$542.7 million in Q2 2025 before moderating again.
  • For readers weighing that caution, it is worth noting that even with 4 Phase III programs and 2 Phase II programs at Q1 2026, the forecasts in the data still point to slower earnings and revenue growth than the broader US market, which fits with concerns about growth and pricing pressure.

Skeptics highlight that even with more late stage programs, forecasts for earnings and revenue growth remain below market levels, which lines up with concerns about pricing, competition and partner reliance if any of the major programs underperform expectations. 🐻 Arrowhead Pharmaceuticals Bear Case

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for Arrowhead Pharmaceuticals on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

If this mix of bullish and cautious signals leaves you undecided, it may be useful to review the underlying figures yourself and consider what stands out most to you. To better understand why some investors are optimistic, review the 2 key rewards

See What Else Is Out There

Arrowhead pairs a high 54x P/E and lumpy, partner driven revenue with slower forecast growth than the wider US market and concentrated pipeline risk.

If that mix of rich pricing and uneven earnings leaves you wanting steadier prospects, compare it with companies screened for 72 resilient stocks with low risk scores and see how a different risk profile feels.

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.