Royalty Pharma PLC
RPRX Healthcare Biotechnology
Royalty Pharma PLC’s revenue for fiscal 2025 (year ended December 2025) was $2.4 billion, up 5.06% from fiscal 2024. In the quarter to June 2026, revenue grew 16.5%, EPS fell 40.0%, free cash flow grew 31.6% and total debt rose 12.0%, each against the same quarter a year earlier. Dividend growth for five consecutive years.
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Royalty Pharma PLC (RPRX) Altman Z-score
Royalty Pharma PLC's Altman Z-score for fiscal 2025 is 1.61, in the distress zone (below 1.81).
Altman Z-score, annual
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Annual newest first
| Period | Altman Z-score | Change (points) |
|---|---|---|
| FY2025 | 1.61 | 0.13 |
| FY2024 | 1.48 | (0.46) |
| FY2023 | 1.94 | 0.06 |
| FY2022 | 1.88 | (0.25) |
| FY2021 | 2.13 | (0.52) |
| FY2020 | 2.65 | — |
How fiscal 2025’s score is made up
| Component | This year | Year before | Result | Points |
|---|---|---|---|---|
| Working capital / total assets | 0.05 | — | 0.05 | |
| Retained earnings / total assets | 0.12 | — | 0.17 | |
| EBIT / total assets | 0.08 | — | 0.26 | |
| Market value of equity / total liabilities | 1.68 | — | 1.01 | |
| Sales / total assets | 0.12 | — | 0.12 | |
| Altman Z-score | Distress zone | 1.61 | ||
| Z″ Variant for non-manufacturing and asset-light companies (drops the sales/assets term, uses book equity) | Grey zone | 2.25 | ||
Z and Z″ put Royalty Pharma PLC in different zones: distress zone by Z, grey zone by Z″.
How the Altman Z-score works
Z = 1.2 × working capital ÷ total assets + 1.4 × retained earnings ÷ total assets + 3.3 × EBIT ÷ total assets + 0.6 × market value of equity ÷ total liabilities + 1.0 × revenue ÷ total assets (Altman, 1968). The market value of equity is the close on the last trading day of the fiscal year times weighted basic shares.
Z″ = 6.56 × working capital ÷ total assets + 3.26 × retained earnings ÷ total assets + 6.72 × EBIT ÷ total assets + 1.05 × book equity ÷ total liabilities (Altman, Hartzell and Peck, 1995), the variant for non-manufacturing and asset-light companies.
| Zone | Z | Z″ |
|---|---|---|
| Safe zone | above 2.99 | above 2.60 |
| Grey zone | 1.81–2.99 | 1.10–2.60 |
| Distress zone | below 1.81 | below 1.10 |
Not worked out for banks, insurers and REITs, whose balance sheets the model does not describe, nor when a figure is missing or there is no share price in the week to the fiscal year end.
Altman Z-score against peers
| Company | Altman Z-score |
|---|---|
| ROIV Roivant Sciences Ltd. compare | 28.3× |
| ARGX argenex SE compare | 24.4× |
| INCY Incyte Corporation compare | 8.6× |
| RVMD Revolution Medicines, Inc. compare | 7.7× |
| ALNY Alnylam Pharmaceuticals, Inc. compare | 7.3× |
| ONC BeOne Medicines Ltd. - Sponsored ADR compare | 5.3× |
| GMAB Genmab A/S Sponsored ADR compare | 2.8× |
| RPRX Royalty Pharma PLC | 1.6× |
| BNTX BioNTech SE Sponsored ADR compare | — |
What Altman Z-score is
The Altman Z-Score weighs working capital, retained earnings, operating profit, market value and sales against assets and debts to gauge the risk of distress.
1.2 × working capital ÷ total assets + 1.4 × retained earnings ÷ total assets + 3.3 × EBIT ÷ total assets + 0.6 × market value of equity ÷ total liabilities + 1.0 × revenue ÷ total assets