United Therapeutics Corporation (UTHR): what the price assumes
In the published model solve dated 2026-Q2, anchored at $518.86, United Therapeutics Corporation (UTHR) is priced for -1.7% growth. boothcheck publishes no house fair value, target price, or buy/sell rating; individual model outputs and user-controlled scenarios are analytical inputs, not Boothcheck targets. Narrative composed 2026-06-28.
Generated: 2026-08-10 · Exported: 2026-08-12 · Source: https://boothcheck.com/report/UTHR
Headline
| Field | Value |
|---|---|
| Ticker | UTHR |
| Company | United Therapeutics Corporation |
| Current price | $518.86/sh |
| Composition | Tyvaso DPI 41% / Nebulized Tyvaso 18% / Remodulin 17% / Orenitram 16% / Unituxin 7% / Adcirca 1% / Other 1% |
What The Price Assumes (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | whole-company |
| Operating margin (value-band context) | 6.8% |
| Operating margin today | 45.3% |
| Margin compression (value-band) | -38.5pp |
| Implied growth | -1.7% |
| Multiple paid | 14x operating income |
The operating-margin figure is value-band context at year 10: derived from the framework's value band, a separate calculation — not part of the priced-in solve.
Solve inputs: computed at a 8.1% cost of capital with 4% terminal growth over a 5-year stage; each 1pp of cost of capital moves the implied operating-profit growth ~5.9pp.
Reconcile: at the x-ray's 9.3% required return this reads ~4.6%/yr; the models below use their own rates.
How unusual the bet is: within-range
| Reference | Value |
|---|---|
| vs own history | -0.72σ |
| cohort percentile (of 117 peers) | 21 |
| implied end-window share | 0% |
Valuation X-Ray
Asset, earnings-power and peer-multiple models all land far below the price; ONLY the growth-DCF reaches it. The bet is durable compounding the static frames structurally cannot price (a moat/durability premium).
How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | 1.58x | 5 | expensive |
| Earnings | 1.83x | 5 | expensive |
| Relative | 1.58x | 5 | expensive |
| Growth | 1.05x | 3 | expensive |
Families that justify the price: Growth Families that call it expensive: Asset, Earnings, Relative
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 9.2%); the inversion above states its own rate.
Per-Model Detail (n=18)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | $498.10 | 1.04x | yes | FCF base $1.0B, growth 6% (input: historical growth), terminal g 4.0%, WACC 9.2%, 5yr projection |
| DCF Exit Multiple | Growth | $496.22 | 1.05x | yes | Exit EV/EBITDA: 12.4x / 14.4x / 16.4x (bear / base = today's held flat / bull), 5yr |
| Relative Valuation | Relative | $673.41 | 0.77x | yes | P/E 24x (static sector reference · 2026-04), scenarios: 20.1x / 24.0x / 27.9x (bear / base = reference held flat / bull), EV/EBITDA 16x |
| Simple DDM | Growth | — | — | no | — |
| Two-Stage DDM | Growth | — | — | no | — |
| Simple Excess Return | Asset | $327.89 | 1.58x | yes | BV/sh $139.02, ROE (TTM) 21.8%, ke 9.3% |
| Two-Stage Excess Return | Asset | $500.50 | 1.04x | yes | 5yr excess ROE then converge to ke=9.3% |
| Discounted Future Market Cap | Growth | $386.44 | 1.34x | yes | Rev $3.2B, growth 6% (input: historical growth; tapered), Terminal P/S: 5.8x / 6.9x / 8.1x (bear / base = today's held flat / bull, cap 8x) |
| Peter Lynch Fair Value | Relative | $324.60 | 1.60x | yes | EPS $27.05, growth 8% (input: historical EPS growth), PEG=2.12 (Overvalued) |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | $274.51 | 1.89x | yes | Normalized EBIT (5y avg op income, one-time charges added back) $1.20B × (1−14%) / WACC 9.2% → EPV (no growth) |
| Residual Income | Asset | $471.20 | 1.10x | yes | BV $139.02 + 5yr PV of (ROE (TTM) 21.8% − Kₑ 9.3%) × BV; BV grows 8.8%/yr |
| Graham Number | Asset | $290.88 | 1.78x | yes | √(22.5 × EPS $27.05 × BVPS $139.02) — Graham's conservative floor |
| EV/EBITDA Relative | Relative | $574.73 | 0.90x | yes | EBITDA $1.46B × sector EV/EBITDA 16.0x |
| FCF Yield | Earnings | $284.10 | 1.83x | yes | FCF $1016.9M / Kₑ 9.3% — zero-growth perpetuity |
| SBC-Adj FCF Yield | Earnings | $245.95 | 2.11x | yes | SBC-adj FCF $0.87B (FCF $1.02B − SBC $0.15B) capitalized at Kₑ |
| Ben Graham Formula | Earnings | $559.50 | 0.93x | yes | EPS $27.05 × (8.5 + 2×8.1%) × (4.4 / 5.3%) |
| ROIC-Justified P/B | Asset | $88.20 | 5.88x | yes | BV $139.02 × (ROIC 5.8% / WACC 9.2%) |
| P/Sales Sector | Relative | $298.71 | 1.74x | yes | Revenue $3.17B × sector P/S 4.0x |
| PEG Fair Value | Relative | $328.24 | 1.58x | yes | EPS $27.05 × (PEG 1.5 × growth 8.1% (input: historical EPS growth)) → PE 12.1x |
| Earnings Yield | Earnings | $292.43 | 1.77x | yes | EPS $27.05 / required return 9.3% (Rf 4.3% + ERP 5.0%) |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Economic-Unit Decomposition (Sum Of The Parts)
Only one reportable economic unit is present in the current topology source. Consolidated operating lenses remain available, but there is no multi-unit decomposition.
| Unit | Role | Valuation basis | Revenue | Reported profit | Value evidence | Status |
|---|---|---|---|---|---|---|
| Biopharmaceuticals | operating | enterprise | 3.2B reported-currency | — | withheld | unresolved no unit value |
No total common-equity value is stated. One or more material units lack a supported unit value. The displayed values are an indicative subtotal; consolidated debt and cash cannot be applied to a fraction of the company.
Solvency
| Field | Value |
|---|---|
| Net cash | $2.2b |
| Net debt / NOPAT (after-tax) | -1.74x (net cash) |
| Net debt / operating income (pre-tax) | -1.50x (net cash) |
| Interest coverage | 87.5x |
| Share count CAGR (buyback) | -0.3% |
| Burning cash | no |
Bullet Takeaways
- United Therapeutics is a pulmonary-hypertension specialist whose engine is the Tyvaso franchise; its inhaled dry-powder version, Tyvaso DPI, grew revenue 9% year over year to anchor a portfolio that produces a 45% operating margin.
- The company is debt-free with about $2.15 billion of net cash and roughly 45% operating margins, and it authorized a new $2 billion buyback, but Q1 2026 revenue slipped about 2% as the older nebulized Tyvaso fell 22%.
- The defining risk is competition in pulmonary hypertension, where the company faces Merck's Winrevair as a new standard of care and Liquidia's Yutrepia as a direct treprostinil rival, in a market its 10-K calls one where several large pharmaceutical companies control many of the available PAH therapies.
Bull Case
Look at where the price sits against the valuation methods, and United Therapeutics is the rare profitable biotech that does not require a leap of faith. At about $536 (June 28, 2026) a share, the price actually sits below where the sector relative-multiple method lands, near $606 on a 24x earnings multiple, and roughly in line with the EV/EBITDA-relative method near $517. For a company with a 45% operating margin and a 22% return on equity, trading at or below peer multiples is unusual; the market is not paying a stretched premium for the franchise. The growth-adjusted earnings method that uses the conservative Graham formula lands near $560, again above the price. The methods that call it expensive are the asset-based ones, which under-value any profitable drug franchise because the value is in the patents and the cash flow, not the book.
The cash-generation profile is exceptional and gives the company optionality most biotechs lack. United Therapeutics earns a 45% operating margin, generates over $1 billion of free cash flow, holds about $2.15 billion of net cash with zero debt, and interest coverage is effectively unlimited. It authorized a new $2 billion buyback, retiring shares at a price below peer multiples. A debt-free company throwing off cash and buying back stock at a reasonable multiple is compounding value the durable way, and the balance sheet funds both the defense of the core franchise and the moonshot pipeline.
The Tyvaso DPI franchise remains the growth driver even as the older formulation fades. In Q1 2026 Tyvaso revenue reached $458 million, with the dry-powder DPI version growing 9% year over year, offsetting much of the 22% decline in the older nebulized form. The DPI version is the more convenient, patent-protected delivery, and the company is extending the inhaled-treprostinil platform with new formulations. Beyond pulmonary hypertension sits the long-shot upside: United Therapeutics is the leader in xenotransplantation, manufacturing gene-edited pig organs, and received FDA clearance to begin the first clinical trial of pig organs for transplant. That program is unproven and years from commercialization, so it is optionality, not a number to bank, but it is a genuine second act backed by a balance sheet that can fund it. The bull case is a cash-rich, profitable franchise trading near peer multiples, with a self-funded transformational pipeline as the free option.
Bear Case
The competitive threat to United Therapeutics is concrete and named, which is the bear's spine. Pulmonary hypertension was United's near-monopoly for years; it is not anymore. Merck's Winrevair, a different mechanism, has emerged as a new standard of care for late-stage disease and competes for the same patient pool, forcing United to reposition Tyvaso as part of combination therapy rather than the sole option. At the same time, Liquidia's Yutrepia, an inhaled dry-powder treprostinil, launched in mid-2025 as a direct rival to Tyvaso DPI and has reportedly taken a meaningful early share of the treprostinil market. United's own 10-K acknowledges it operates in a highly competitive market in which several large pharmaceutical companies control many of the available PAH therapies. A franchise facing both a new-mechanism competitor and a direct formulation rival is fighting on two fronts at once, and the price assumes it holds its ground.
The recent numbers show the pressure arriving. Q1 2026 revenue slipped about 2% to $781.5 million, net income fell to $274.9 million from $322.2 million, and GAAP EPS of $5.82 missed expectations; the older nebulized Tyvaso fell 22% on weaker U.S. demand and softer international sales. Tyvaso DPI growth of 9% is offsetting that decline for now, but a single franchise carrying the whole company is a concentration risk: if Yutrepia continues taking share and Winrevair compresses the prostacyclin market, the growth that the price depends on stalls. The company pays MannKind a royalty on Tyvaso DPI net sales, so even the growing product shares its economics.
The valuation depends on durable compounding, and that is the assumption competition challenges. The price is reached only by the forward-growth methods; the asset and earnings-power methods land far below, with normalized earnings power near $247 and the simple excess-return method near $295. If the PAH franchise plateaus or declines under competitive pressure, the price has the forward-growth assumption to fall back on and little else. The xenotransplantation program is exciting but is years away, unproven commercially, and consumes cash today for a payoff that is bimodal and distant; it cannot be valued as a steady contributor. The balance sheet removes any solvency concern, with net cash and no debt, so the bear is not about survival. It is that a single-franchise specialist faces a named, well-capitalized competitive assault on its only profit engine, while the price still credits years of durable growth.
Valuation
The price embeds a surprisingly low bar for such a high-margin business. Inverting today's price near $536 implies almost no growth, around flat, on an operating margin near 8%, far below the 45% United Therapeutics actually earns. In plain terms, the price requires the franchise to barely grow and to give up most of its margin, which is a pessimistic embedded assumption for a company currently compounding Tyvaso DPI at 9%. That gap between the demanding-looking premium to the static methods and the modest embedded growth assumption is the key to reading the stock: the market is not paying for heroic growth, it is paying for the franchise to roughly hold.
The methods cluster more favorably than the headline premium suggests. The relative-multiple methods land at or above the price, with the sector price-to-earnings approach near $606 and the EV/EBITDA-relative method near $517 on a 16x multiple, so peer multiples roughly bracket or exceed the price. The growth-adjusted Graham formula lands near $560, also above. The forward-growth cash-flow methods land near $447 to $498, just below the price. The asset and earnings-power methods land far below, near $247 to $295, but those systematically under-value a patent-protected drug franchise whose worth is in its cash flow, not its book. The honest read is a profitable specialty pharma trading near where peer multiples land, with the static asset methods structurally too low for this kind of business.
The balance sheet is a genuine strength and bounds the downside firmly. United Therapeutics holds about $2.15 billion of net cash with zero debt and generates over $1 billion of free cash flow, so there is no solvency risk and the company self-funds both its franchise defense and its pipeline, including the $2 billion buyback. The peer set runs to other specialty and rare-disease drug makers, where the relevant question is franchise durability and pipeline, not relative cheapness. The xenotransplantation program is optionality the standard methods cannot price and should not be banked; it is a self-funded long shot on top of the cash-generative core. What the buyer is underwriting at this price is that the PAH franchise holds against named competition, with the pipeline and the cash a free option rather than the basis of the valuation.
Catalysts
The Q1 2026 report was the catalyst, and it showed the competitive pressure starting to register. Total revenue slipped about 2% to $781.5 million, net income fell to $274.9 million from $322.2 million, and GAAP EPS of $5.82 missed expectations. Within the franchise, Tyvaso reached $458 million with the dry-powder DPI version up 9% year over year, while the older nebulized Tyvaso fell 22% on weaker U.S. demand and softer international sales. The company also authorized a new $2 billion share buyback, leaning on its cash position to support the stock.
The competitive developments are the catalysts that matter most. Merck's Winrevair has established itself as a new standard of care in late-stage pulmonary hypertension, and Liquidia's Yutrepia launched in mid-2025 as a direct inhaled-treprostinil rival to Tyvaso DPI, taking early market share. United is responding with combination-therapy positioning and new inhaled-treprostinil formulations. The pace at which Yutrepia takes share and Winrevair penetrates the prostacyclin patient pool will drive the Tyvaso trajectory.
The other catalyst is the xenotransplantation program, where United received FDA clearance to begin the first clinical trial of gene-edited pig organs for transplant, following earlier compassionate-use UKidney and UHeart transplants. That program is the long-term optionality, and any clinical-trial progress would be a discrete catalyst, though commercialization remains years away. The near-term watch items are the quarterly Tyvaso DPI growth rate against Yutrepia's share gains and any data updates from the xenotransplantation trial.
Peer Cohorts (Per Segment, With Filing Citations)
Biopharmaceuticals (reported)
- BMRN (BioMarin Pharmaceutical Inc)
- FY2025 10-K: …Inc., C-Biomex Co., Ltd., Changchun GeneScience Pharmaceuticals Co., Ltd., Immunoforge, Co. Ltd., Peptron Inc., Prolynx Inc., and SiSaf Ltd. BMN 333, for the treatment of hypochondroplasia, could have competition from clinical stage products under development by Ascendis Pharma A/S and QED Therapeutics, Inc. (a…
- FY2025 10-K: …licenses or other collaboration opportunities, our ability to continue to expand our product pipeline and our growth and development would be impaired. Our future growth and development depend in part on our ability to successfully develop new products from our development activities. The development of…
- VRTX (VERTEX PHARMACEUTICALS INC / MA)
- FY2025 10-K: …in focus and priorities as new information becomes available and as we gain additional understanding of our ongoing programs and potential new programs, as well as those of our competitors. In addition, our product candidates must satisfy rigorous standards of safety and efficacy before they can be approved for sale…
- FY2025 10-K: 024 000-19319 10.29 Employee Non-disclosure, Non-competition and Inventions Agreement between Jeffrey M. Leiden and Vertex Pharmaceuticals Incorporated, dated December 14, 2011.* 10-K (Exhibit 10.35) February 22, 2012 000-19319 10.30 Employment Agreement, dated as of July 24, 2019, between Vertex Pharmaceuticals…
- JAZZ (Jazz Pharmaceuticals plc)
- FY2025 10-K: …an emphasis on pollution prevention. Competition The biopharmaceutical industry is highly competitive. Our products compete, and our product candidates may in the future compete, with currently existing therapies, product candidates currently under development by us and others and/or future product candidates,…
- FY2025 10-K: …procurement or funding associated with "biotechnology companies of concern" and restricting use of their equipment and services in federal contracts, grants, and loans. The implementation of the act will be phased in over a period of years, and could severely restrict the ability of companies to work with certain…
- ACAD (ACADIA PHARMACEUTICALS INC)
- FY2025 10-K: …disorder. Our competitors may also develop alternative therapies that could further limit the market for any drugs that we may develop. Many of our competitors are using technologies or methods different or similar to ours to identify and validate drug targets and to discover and develop drug candidates. Many of our…
- FY2025 10-K: …strategy and are designed to enhance our competitive position, drive innovation, and meet the evolving needs of patients worldwide. The four core capabilities in which we are investing are: 1. Precision Medicine . We are focused on integrating strategies that address the variability in patients' responses to…
- BIIB (BIOGEN INC.)
- FY2025 10-K: …have been and may in the future be necessary in some instances to determine the validity and scope of certain of our patents, regulatory exclusivities or other proprietary rights, and in other instances to determine the validity, scope or non-infringement of certain patent rights claimed by third parties to be…
- FY2025 10-K: …Inc. IPR&D In-process Research and Development IRA Inflation Reduction Act of 2022 IT Information Technology IV Intravenous LEQEMBI Collaboration Agreement Amended and Restated Collaboration Agreement entered into by Biogen MA Inc. and Eisai Co., Ltd. on October 22, 2017, as amended on March 13, 2022 LRRK2…
- ALKS (Alkermes plc.)
- FY2025 10-K: …flows and results of operations. 45 Uncertainty over IP in the biopharmaceutical industry has been the source of litigation and other legal proceedings, and we and our licensees have previously and may in the future face claims against IP rights covering our products and competition from generic drug manufacturers.…
- FY2025 10-K: …INVEGA products and RISPERDAL CONSTA, products from which we receive manufacturing and/or royalty revenues. The biopharmaceutical industry is characterized by intensive research, development and commercialization efforts and rapid and significant technological change. In many cases, there are already products on the…
- INDV (Indivior Pharmaceuticals, Inc.)
- FY2025 10-K: …U.S. Our products also compete with various alternatives including oral buprenorphine, methadone, and other drugs indicated for OUD and, in the future, may experience competition from other therapies or drugs. Our SUBOXONE Film product has faced four generic competitors in the U.S. for some time. We have seen our…
- FY2025 10-K: …in 2017 as the first once-monthly subcutaneous extended-release injectable suspension of buprenorphine. We initiated commercial sales of SUBLOCADE in 2018. It took until 2020 to reach $100 million in annual net revenues for SUBLOCADE. In the U.S., a competitor introduced its own subcutaneous extended-release…
- ADMA (ADMA BIOLOGICS, INC.)
- FY2025 10-K: …any collateral securing the JPM Loans. 48 Table of Contents Developments by competitors may render our products or technologies obsolete or non-competitive. The biotechnology and pharmaceutical industries are intensely competitive and subject to rapid and significant technological change. Our current products and any…
- FY2025 10-K: …customers, BioCare, Inc. ("BioCare") and Priority Healthcare Distribution, Inc. d/b/a CuraScript SD Specialty Distribution ("CuraScript"), represented an aggregate of approximately 73% and 72%, respectively, of our consolidated revenues. As of December 31, 2025, two customers, BioCare and CuraScript, represented an…
Methodology Note
- Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
- Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
- Economic-unit decomposition (SOTP): each disclosed business unit is assigned its native valuation basis before any multiple is applied. Operating units are valued on enterprise value; funded financial units are valued on their own common equity, because their borrowings fund earning assets rather than levering the parent. A company total is stated only once every material unit carries a supported value and the parent capital bridge reconciles.
- Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
- Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.
Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.
Sources
UTHR Q1 2026 earnings release, May 2026 · UTHR FY2024 10-K