TG Therapeutics (TGTX) Stock May Be Below Fair Value As BRIUMVI Gains Share

TG Therapeutics has turned into a headline stock after a very large 3 year run, which puts fresh focus on whether the current US$57.52 share price is supported by its earnings power. With the multiple sclerosis drug BRIUMVI gaining traction, the question now is how much of that operational story is already reflected in the valuation.

• A roughly 588.0% return over the past 3 years has radically changed the size of a position in TG Therapeutics for long term holders. As a result, the earnings underpinning that move matter more than ever.
• BRIUMVI capturing about one third of the intravenous anti CD20 market for relapsing multiple sclerosis may support higher revenue expectations, which can feed directly into how investors think about the sustainability of its earnings base.
• There is a second opinion on TG Therapeutics worth weighing. See what analysts think TG Therapeutics's shares could be worth.

The issue now is whether TG Therapeutics' current price is justified by the earnings profile that the business is generating today.

If you want to test the same earnings question that hangs over TG Therapeutics against a wider set of companies, scan through 30 high quality undervalued stocks.

Is TG Therapeutics a Bargain on Earnings?

The P/E ratio is a useful lens here because TG Therapeutics is now generating positive earnings that can be compared directly with its share price. On current numbers, the stock trades at about 18.5x earnings, which is close to the broader biotech sector on 17.3x and far below the peer group average of 60.1x. That gap to peers suggests investors are not paying the kind of premium that some faster growing or more diversified biotechs command.

Based on the tailored fair multiple that reflects TG Therapeutics' own margins, risk profile and scale, the current P/E sits below where that model would place it. On this framework the shares screen as undervalued rather than stretched. Because BRIUMVI has already captured roughly one third of the intravenous anti CD20 market, this more modest earnings multiple implies the recent commercial progress is not being priced as aggressively as in some comparator stocks. Explore the numbers behind TG Therapeutics's P/E valuation.

The TG Therapeutics Narrative: What Would Justify Today's Price?

Narratives for TG Therapeutics pick up where the valuation question leaves off and explain what path for growth, profitability and earnings would need to occur for the stock to appear meaningfully cheaper or more expensive than it does today. These narratives are available on Simply Wall St's Community page. Rather than relying on a single P/E or one model output, each narrative lays out the assumptions behind its view of fair value so you can compare those expectations with actual results as they are reported.

Community views on TG Therapeutics are split between those who see more upside in the BRIUMVI story and those who think expectations have already run ahead of execution risk.

Bull case: 17% undervalued

"The planned launch of subcutaneous (subcu) BRIUMVI is a significant upcoming catalyst, as it could unlock access to 35-40% of the anti-CD20 MS market segment…"

Discover why this Narrative puts TG Therapeutics at 17% undervalued.

Bear case: 100% overvalued

"The heavy reliance on BRIUMVI for revenue, combined with a narrow commercial portfolio and slow pipeline progression, leaves TG Therapeutics extremely exposed to competitive threats…"

Explore why this Narrative puts TG Therapeutics at 100% overvalued.

Before you act on TG Therapeutics’ valuation, there is one more piece to check

The share price, earnings and BRIUMVI story only tell part of what you need to know about TG Therapeutics, because the people steering the business and how they are rewarded can heavily influence what happens next. See who runs TG Therapeutics and how they are paid.

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.

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