• If you are wondering whether Supernus Pharmaceuticals is priced attractively right now, you are not alone. Many investors are looking at what they are really getting for the current share price.
• The stock last closed at US$49.37, with returns of 0.6% over the past week, 0.2% over the past month, a small 0.2% decline year to date, 27.1% over the past year, 26.6% over three years and 61.1% over five years.
• Recent attention on Supernus has been shaped by ongoing interest in its neurology focused portfolio and how the market is pricing its pipeline and approved treatments, which helps explain why investors are closely watching the share price. This context is important because it frames whether the current level reflects only sentiment or something more fundamental.
• Our valuation checks give Supernus a score of 6/6 for potential undervaluation. Next, we will walk through the key valuation approaches behind that score, before finishing with a way to look at value that can give you an even clearer picture.

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

A Discounted Cash Flow model takes the cash Supernus Pharmaceuticals is expected to generate in the future and discounts those amounts back to today, to estimate what the entire business might be worth in dollars.

In this case, the model uses a 2 Stage Free Cash Flow to Equity approach. Supernus’ last twelve month Free Cash Flow is about $71.1 million. Analyst-based projections for 2026 to 2030 range from $86.2 million up to $473.5 million, with later years from 2031 to 2035 extrapolated by Simply Wall St rather than coming directly from analysts.

When all of those future cash flows are discounted back and summed, the DCF model produces an estimated intrinsic value of about $199.97 per share. Compared with the recent share price of US$49.37, this implies the stock is trading at a 75.3% discount to that DCF estimate. This highlights a wide gap between the model value and the current market price.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Supernus Pharmaceuticals is undervalued by 75.3%. Track this in your watchlist or portfolio, or discover 55 more high quality undervalued stocks.

Approach 2: Supernus Pharmaceuticals Price vs Sales

For companies where earnings can be distorted by non cash charges or investment in research, the P/S ratio is often a useful way to compare what you are paying for each dollar of revenue. It is still influenced by growth expectations and risk, because investors usually accept a higher P/S when they expect stronger growth and lower risk, and a lower P/S when they see weaker growth or higher risk.

Supernus Pharmaceuticals currently trades on a P/S of 4.15x. That sits slightly below the Pharmaceuticals industry average P/S of 4.57x and well below the peer group average of 9.35x. Simply Wall St also calculates a proprietary “Fair Ratio” of 6.74x for Supernus, which is the P/S level suggested by factors such as its earnings growth profile, industry, profit margins, market cap and specific risks.

This Fair Ratio can be more informative than a simple comparison to peers or the broad industry, because it adjusts for Supernus’ own characteristics rather than assuming that all companies should trade at the same multiples. Comparing the Fair Ratio of 6.74x with the current P/S of 4.15x indicates that the shares are trading below that model based estimate.

Result: UNDERVALUED

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Upgrade Your Decision Making: Choose your Supernus Pharmaceuticals Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives, which put a clear story behind your numbers for Supernus Pharmaceuticals.

A Narrative is simply your own view of the company, written as a short story about its products, risks and opportunities, and then translated into assumptions for future revenue, earnings and profit margins.

On Simply Wall St, Narratives connect that story to a financial forecast and then to a Fair Value, so you can directly compare what you think Supernus is worth with the current share price.

You will find these Narratives in the Community section of the platform, where millions of investors share their views, and the Fair Values linked to each Narrative update automatically when new information like earnings releases or news is added.

This makes it easier to decide whether you see Supernus as fairly priced, expensive or cheap for your expectations. It also explains why one investor might see a very high Fair Value for Supernus while another assigns a much lower figure based on different assumptions.

Do you think there's more to the story for Supernus 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.