Key Morningstar Metrics for Roche
- Fair Value Estimate: CHF 364
- Morningstar Rating: ★★★★
- Morningstar Economic Moat Rating: Wide
- Morningstar Uncertainty Rating: Low
What We Thought of Roche’s Earnings
Roche ROG saw 7% sales growth at constant exchange rates in 2025 (2% as reported), with core earnings per share growth of 11% (4% as reported). Management guided to mid-single-digit sales growth and high-single-digit core EPS growth in 2026 at constant currencies. The ADRs rose 5% intraday on Jan. 29.
Why it matters: Roche does not face a patent cliff and will soon annualize China diagnostics headwinds, putting it in position to maintain solid growth in 2026.
- Biosimilar competition is weighing on growth of immunology drugs Actemra (ongoing) and Xolair (2027) as well as breast cancer drug Perjeta (2028). But their combined sales are less than 15% of Roche’s top line, making it easier for new products to drive growth.
The bottom line: We’re maintaining our CHF 364/USD 57 fair value estimate for wide-moat Roche, which looks fairly valued to us after strong performance since the start of the fourth quarter.
- Overall biopharma industry sentiment has improved, particularly on US pricing policy, and Roche’s agreement with the Trump administration defends against tariffs and potential Medicare price cuts in exchange for deeper discounts for some Medicaid therapies.
- Roche’s pipeline has had a string of positive readouts, and we think the recent success of breast cancer drug giredestrant in HR-positive, HER2-negative breast cancer trials gives Roche a path to differentiation against competition in the field.
Coming up: We see several 2026 trial readouts including giredestrant in breast cancer, fenebrutinib in multiple sclerosis, CT-996 and petrelintide in obesity, and a potential 2027 readout for Alzheimer’s drug trontinemab.
- Combined sales of Roche’s obesity pipeline reach CHF 8 billion by year 10 of our forecast, partly due to Roche’s multiple programs and the sheer size of this market.
- We’re bullish on Roche’s ability to continue to grow in breast cancer (giredestrant) and hemophilia (NXT007), as well as new launches in immunology (afimkibart) and Alzheimer’s (trontinemab).
