Royalty Pharma Plc (RPRX) Steady Outperformance, Another Beat and Raise

Equity Research 6 August 2026 | 6:00AM EDT

Royalty Pharma Plc (RPRX): Steady Outperformance, Another Beat and Raise

RPRX delivered another solid set of 2Q26 results, with topline portfolio receipts and Asad Haider, CFA | adjusted EBITDA both ahead of Street estimates and raised FY 2026 guidance. Goldman Sachs & Co. LLC

Portfolio Receipts of $773mn beat GS/Visible Alpha Consensus Data expectations of Nick Jennings | $754mn/$762mn, driven by royalties on Tremfya, Voranigo, Imdelltra and Evrysdi. Goldman Sachs & Co. LLC RPRX raised FY26 Portfolio Receipts guidance to $3,400mn to $3,500mn (from $3,325mn-$3,450mn), and now expect royalty receipts to grow by 7% to 10% (up Jeff Su | Goldman Sachs & Co. LLC from the previous 4% to 8% projection). The 2Q performance trends again leave us incrementally confident that RPRX remains in the early stages of a multi-year portfolio expansion that we believe is underappreciated in the context of a large, growing TAM for royalty funding.

Building on what we highlighted following the last quarterly result, shares of RPRX have continued to quietly outperform (now +49% YTD) compared to both pharma (DRG +8%) and biotech (XBI +25%) benchmarks, and our inbounds continue to highlight the increasing appeal of the stock in the current environment, as generalists are seeking exposure to biopharma/biotech, but narratives on single names remain nuanced. As noted in our initiation Uniquely Positioned In Early Innings of Long-Term Royalty Market Growth, we see RPRX as a unique vehicle through which generalist portfolio managers can gain exposure to a highly curated portfolio of biopharma royalty streams without incurring biotech’s volatility and binary risks.

We increase our 12m PT to $66 (from $59) on updated estimates and an EV/EBITDA valuation multiple of 12.5x (unchanged).

What Stood Out To Us n Financials. Royalty Receipts grew by 14% Y/Y to $768mn, driven by strong performances from Tremfya, Voranigo, Imdelltra, and Evrysdi. Headwinds from Promacta (loss of exclusivity) and Imbruvica, were absorbed. Operating and professional costs were kept at 4.8% of portfolio receipts. RPRX returned approximately $367mn to shareholders in 1H26 through dividends ($271mn) and share repurchases ($96mn), representing about 25% of portfolio cash flow. Following an S&P upgrade in June, RPRX is now rated BBB across all major credit rating agencies. RPRX ended 1H26 with $812mn in cash and equivalents, $9.2bn of investment-grade debt outstanding (weighted average duration of ~12 years), and leverage of 2.8x total debt to adjusted EBITDA (2.6x on a net basis). RPRX noted they maintain over $4bn in total financial flexibility.

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Goldman Sachs Royalty Pharma Plc (RPRX)

n Capital Deployment. RPRX deployed $877mn in 1H26, with total announced transaction value reaching $1.7bn and $1.1bn deployed year-to-date. n Acquisition of Royalty on AZN’s Cliramitug. In July 2026, RPRX acquired a portion of Neurimmune’s royalty interest in AZN’s cliramitug (a Ph3 first-in-class TTR-fibril-depleting antibody for ATTR-CM) for up to $425 million. RPRX will receive a 3.75% royalty on worldwide net sales. AZN projects peak annual sales of $3bn to $5bn, translating to peak annual royalties of $110mn to $190mn for RPRX, with an expected IRR in the teens. n Key Upcoming Readouts. For 2026, RPRX highlighted Ph3 outcomes trial results for Novartis’ pelacarsen (Lp(a) cardiovascular outcomes) and Ph3 data for Biogen’s litifilimab (systemic lupus). Looking ahead to 2027, RPRX highlighted Ph3 results for Revolution Medicines’ daraxonrasib (lung cancer), Biogen’s litifilimab (cutaneous lupus), Sanofi’s frexalimab (multiple sclerosis), and…