Is Royalty Pharma Plc overvalued or undervalued?

As of 14 November 2025, the valuation grade for Royalty Pharma Plc has moved from expensive to fair. The company appears to be fairly valued based on its current metrics. Key valuation ratios include a P/E ratio of 11, a Price to Book Value of 2.84, and an EV to EBITDA of 13.43. In comparison, Incyte Corp. shows a higher P/E of 22.95, indicating that Royalty Pharma may be more attractively priced relative to its peer.
Despite recent stock performance, where Royalty Pharma has outperformed the S&P 500 with a year-to-date return of 53.51% compared to the S&P 500's 14.49%, the long-term returns over 3 and 5 years have lagged significantly. This suggests that while the company is currently fairly valued, its historical performance may warrant a cautious approach for potential investors.