ALKSAlkermes plc
Is the business good?
The checks split: earnings fully cash-backed (3.2×), but margins compressing.
Operating profit is fully backed by cash. Conversion is improving vs a year ago.
Operating profit is falling even as sales grow, costs are outrunning the top line.
A balanced mix of margins, efficiency, and leverage. ROE 11% = margin × turnover × leverage.
Unless marked, from derived.
Where this answer is blind. The F-score rewards improvement, so an already-elite company can score mid-pack.
How good a business is ALKS?
Alkermes plc earns 3.5% on the capital it employs against a 9.0% cost of capital, so growth costs more than it returns.
Return on invested capital · cost of capital 9.0% · 5.5 points below what the capital costs: growth destroys value
- Operating margin
- 7.0%
Operating margin · Drug Manufacturers - Specialty & Generic median 11% · 12 months to Q2 2026
- Cash conversion
- 3.15×
Cash conversion · 1.64× a year ago · operating cash flow covers the operating profit after tax
- Share count, year on year
- +3.0%
Share count, year on year · shareholders own a smaller slice than a year ago
| Year | Operating margin |
|---|---|
| FY2020 | −11% |
| FY2021 | 8.3% |
| FY2022 | −0.55% |
| FY2023 | 25% |
| FY2024 | 27% |
| FY2025 | 17% |
Details›
- Gross margin12 months to Q2 2026
- 85%
- Operating margin12 months to Q2 2026
- 7.0%
- Net margin12 months to Q2 2026
- 4.0%
- Free cash flow margin
- 13%
- R&D as % of revenue
- 23%
- Revenue, trailing twelve months
- $1.67B
- Free cash flow, trailing twelve months
- $222M
- Net income, trailing twelve months
- $66M
- Return on invested capitaloperating profit after tax ÷ debt + equity − cash
- 3.5%
Margins, capital and share counts from the statements as filed with the SEC; cash conversion is operating cash flow over operating profit after tax.
Drug Manufacturers, Specialty & Generic
Ranks #17 of 41 by RyuScore