Is Royalty Pharma Plc overvalued or undervalued?

As of 8 May 2025, Royalty Pharma Plc's valuation grade has moved from fair to attractive, indicating a positive shift in its perceived value. The company is currently assessed as undervalued. Key ratios include a P/E ratio of 11, a Price to Book Value of 2.84, and a PEG ratio of 0.08, which suggests that the stock is trading at a lower valuation relative to its growth prospects.
In comparison to its peers, Royalty Pharma Plc has a P/E ratio of 10.83, while Alnylam Pharmaceuticals, Inc. is deemed risky with a P/E of -827.79, and Incyte Corp. shows a significantly higher P/E at 301.24. The EV to EBITDA ratio for Royalty Pharma is 13.43, which is competitive within its industry context. Notably, the company's recent stock performance has outpaced the S&P 500, with a year-to-date return of 38.77% compared to the S&P 500's 2.44%.