• Investors may be wondering if Crinetics Pharmaceuticals at around US$55.41 per share is still offering fair value, or if the recent excitement has already been priced in.
• The stock shows a flat 7 day return, while the 30 day return is 12.5%, year to date is 18.6%, and the 1 year return is 43.4%, with a very large 5 year gain of 282.9%. This performance may have changed how the market views its risk and potential.
• Recent coverage has focused on Crinetics Pharmaceuticals as a growth oriented biotech name, with attention on its late stage clinical pipeline and progress in endocrine disease treatments. These updates help explain why the share price has been in focus for investors watching the sector.
• Crinetics Pharmaceuticals currently has a value score of 3 out of 6. In the following sections, we will look at how different valuation methods assess the stock and then finish with a more holistic way to think about its valuation story.

Approach 1: Crinetics Pharmaceuticals Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow, or DCF, model estimates what a company might be worth today by projecting its future cash flows and discounting them back to a present value.

For Crinetics Pharmaceuticals, the model used is a 2 Stage Free Cash Flow to Equity approach. The latest twelve month free cash flow is a loss of about $350.6 million. Analyst inputs and extrapolations then project annual free cash flows through 2035, moving from projected losses in the nearer years to a projected free cash flow of $608 million in 2030 and higher values after that. All of these figures are in US$.

When those projected cash flows are discounted back to today, the model arrives at an estimated intrinsic value of about $491.04 per share. Compared with the current share price of around $55.41, this DCF output implies the shares are about 88.7% undervalued on this set of assumptions.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Crinetics Pharmaceuticals is undervalued by 88.7%. Track this in your watchlist or portfolio, or discover 881 more undervalued stocks based on cash flows.

Approach 2: Crinetics Pharmaceuticals Price vs Book

For profitable companies that build up meaningful net assets over time, the price to book, or P/B, ratio is a useful way to see how the market values each dollar of equity on the balance sheet. Investors usually accept a higher P/B when they expect stronger growth or see lower risk, and a lower P/B when expectations are more muted or risks feel higher.

Crinetics Pharmaceuticals currently trades on a P/B ratio of 5.30x. That compares with the wider Pharmaceuticals industry average of about 2.60x and a peer group average of 9.03x, so the stock is sitting between sector norms and closer peers. Simply Wall St also uses a proprietary “Fair Ratio”, which is the P/B multiple it would expect for the company after factoring in elements such as earnings growth profile, margins, industry classification, market cap and specific risk characteristics.

This Fair Ratio framework can be more informative than a simple industry or peer comparison because it adjusts for company specific attributes rather than assuming that every firm in the group deserves the same valuation. In this case, the Fair Ratio for Crinetics Pharmaceuticals is not available, so it is not possible to say whether the current 5.30x P/B looks overvalued, undervalued, or about right relative to that metric.

Result: ABOUT RIGHT

P/B ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1447 companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Crinetics Pharmaceuticals Narrative

Earlier we mentioned that there is an even better way to think about valuation. Let us introduce you to Narratives, which are simply your story about a company, backed up by your own fair value, revenue, earnings and margin assumptions, all linked into a forecast that you can compare against the current price.

On Simply Wall St, within the Community page used by millions of investors, Narratives give you a clear bridge from a company’s story to a set of financial forecasts and then to a fair value that helps you decide whether you see Crinetics Pharmaceuticals as priced attractively, fully valued, or expensive today.

Because Narratives sit on the platform, they update automatically when fresh information arrives, such as new clinical news or earnings releases. This means your view of fair value stays aligned with the latest data rather than a static spreadsheet.

For example, one Crinetics Pharmaceuticals Narrative might assume relatively cautious revenue and margins, while another assumes much stronger commercial traction. Those different stories can produce very different fair values that you can weigh against the current share price to decide whether you want to buy, hold, or sell.

Do you think there's more to the story for Crinetics Pharmaceuticals? Head over to our Community to see what others are saying!

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.