Is Innoviva, Inc. overvalued or undervalued?

As of 7 May 2025, the valuation grade for Innoviva, Inc. has moved from expensive to risky, indicating a shift in perception regarding its financial health and market position. The company is currently assessed as overvalued. Key ratios include a P/E ratio of 15, an EV to EBITDA of 9.21, and a PEG ratio of 0.20, which suggests that while the earnings are relatively stable, the growth expectations may not justify the current price.
In comparison to peers, Innoviva's P/E ratio of 15.38 is notably higher than Ligand Pharmaceuticals, which has a P/E of -27.37, and MannKind Corp., which stands at 22.57. This indicates that Innoviva may be priced higher relative to its earnings potential compared to its peers. Additionally, despite a strong return of 30.94% over the past year, the company's performance has lagged behind the S&P 500's 10.26% return, reinforcing the view that Innoviva may not be a sound investment at its current valuation.