Our target price for Alnylam is $364 per share, derived by conducting a discounted cash flow (DCF) analysis in which we project risk-adjusted free cash flows through 2035E and utilize a terminal growth rate of 2%. We then discount these cash flows back by 10% annually. In our biotechnology coverage universe, we utilize a 10% discount rate for all companies that have approved products that provide meaningful revenue contributions.  

We rate ALNY as High Risk based on the usual volatility of biotech stocks and uncertainty/risk associated with clinical trials and late-stage drug development. There are multiple key risks to our target price and rating for Alnylam. First, as a commercial stage company, revenue shortfalls on the top line could negatively impact value. Next, as with many biotechnology stocks, there are both clinical and regulatory risks. Unexpectedly negative updates in either domain could be detrimental to share value. These include clinical shortfalls of its development program including vutrisiran, zilebesiran and ALN-APP (as well as others), changes in timelines, and negative regulatory decisions. Similarly, positive updates for competitive therapies could also impact shares. Last, as biotechnology is a capital-intensive industry, there is a material possibility that Alnylam could elect to seek potentially dilutive financing.