Value
6.3/10data confidence 67%| Component | Sub-score |
|---|---|
| P/E | 9.5 |
| P/S | 4.8 |
| Fwd P/E | 8.5 |
| Analyst target | 3.0 |
- ▸Forward P/E: 13.5x
TBPH · Why this verdict
Why Theravance Biopharma (TBPH) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.4/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Theravance is flagged as a wide-moat business that has compounded strong returns and growth, with an excellent 50% ROE and a strong Piotroski score of 9 out of 9, indicating high fundamental quality despite earnings volatility. Quality breakdown | ROE should remain in a range near 50% and the Piotroski F-Score should hold at 8 or above over the next 12 months. | →Stable |
| CounterThe same quality note flags an earnings quality red flag with only 20% FCF-to-net-income conversion, suggesting the reported ROE and quality score may not translate into durable cash generation. | ||
The company has missed earnings estimates in two of the last four quarters, including large misses of -86.11% and -81.94% surprise, raising doubt about near-term execution. Earnings | The earnings surprise percentage should turn positive and beat_count should exceed miss_count over the next four quarters, with the next report on 2026-08-12. | →Stable |
| CounterThe two most recent misses followed two prior beats of +187.0% and +60.24% surprise, so the pattern may reflect quarter-to-quarter volatility rather than a structural decline. | ||
The stock has already reached its analyst price target with only -17.2% implied upside per the V8 signal, meaning the market has largely priced in expected value. Estimated upside | Additional analyst upgrades or a higher price target would need to emerge to justify holding for further upside beyond 12 months. | →Stable |
| CounterAnalyst targets can lag fast-moving biotech news, so a positive catalyst such as a trial readout could push the target itself higher rather than the stock lower. | ||
The engine's risk framework flags a negative asymmetry ratio of -3.3, meaning current downside risk of 5.2% outweighs the expected move, a setup the engine explicitly failed on its asymmetry gate. Warnings | The asymmetry ratio should turn positive, rising above 1.5, before the position becomes attractive to add to. | →Stable |
| CounterHigh short interest of 15% could set up a short squeeze that pushes the stock higher independent of the fundamental asymmetry calculation. | ||
Theravance is flagged as a wide-moat business that has compounded strong returns and growth, with an excellent 50% ROE and a strong Piotroski score of 9 out of 9, indicating high fundamental quality despite earnings volatility.
→StableQuality breakdown
- Expectation
- ROE should remain in a range near 50% and the Piotroski F-Score should hold at 8 or above over the next 12 months.
CounterThe same quality note flags an earnings quality red flag with only 20% FCF-to-net-income conversion, suggesting the reported ROE and quality score may not translate into durable cash generation.
The company has missed earnings estimates in two of the last four quarters, including large misses of -86.11% and -81.94% surprise, raising doubt about near-term execution.
→StableEarnings
- Expectation
- The earnings surprise percentage should turn positive and beat_count should exceed miss_count over the next four quarters, with the next report on 2026-08-12.
CounterThe two most recent misses followed two prior beats of +187.0% and +60.24% surprise, so the pattern may reflect quarter-to-quarter volatility rather than a structural decline.
The stock has already reached its analyst price target with only -17.2% implied upside per the V8 signal, meaning the market has largely priced in expected value.
→StableEstimated upside
- Expectation
- Additional analyst upgrades or a higher price target would need to emerge to justify holding for further upside beyond 12 months.
CounterAnalyst targets can lag fast-moving biotech news, so a positive catalyst such as a trial readout could push the target itself higher rather than the stock lower.
The engine's risk framework flags a negative asymmetry ratio of -3.3, meaning current downside risk of 5.2% outweighs the expected move, a setup the engine explicitly failed on its asymmetry gate.
→StableWarnings
- Expectation
- The asymmetry ratio should turn positive, rising above 1.5, before the position becomes attractive to add to.
CounterHigh short interest of 15% could set up a short squeeze that pushes the stock higher independent of the fundamental asymmetry calculation.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Theravance shows genuine fundamental quality — a wide moat and strong cash returns — but the market has already priced in most of the near-term upside, and recent earnings misses plus a negative risk/reward setup argue for caution rather than adding to the position.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
5.7/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 10.0 |
| ROA | 0.5 |
| Gross margin | 10.0 |
| Op margin | 0.0 |
| Current ratio | 5.0 |
| FCF quality | 1.6 |
| Moat | 9.0 |
| Rule of 40 | 5.5 |
| Piotroski F | 10.0 |
- ▸Excellent ROE: 50%
- ▸Earnings quality RED FLAG: 20% FCF/NI
- ▸Wide economic moat
- ▸Compounder quality: strong returns + growth
Growth
6.2/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 6.2 |
Momentum
3.9/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 3.9 |
| OBV | 1.0 |
| MA position | 9.0 |
| Volume | 0.1 |
- ▸Volume distribution (falling OBV)
- ▸Above 200-day MA
Sentiment
4.1/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 2.5 |
| Analyst rating | 5.0 |
| Price target | 4.6 |
- ▸LLM news sentiment: -0.50 (n=1)
Insider
4.6/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 4.5 |
| insider conviction | 2.0 |
| holder change | 7.3 |
- ▸Modest insider selling — $218,167 (0.025% of mkt cap)
Peer rank
6.5/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 6.9 |
| quality rank | 9.7 |
| growth rank | 5.1 |
- ▸Superior ROE vs peers
- ▸Best-in-class margins
Technical
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 4.0 |
| support resistance | 4.8 |
| 52w position | 6.2 |
Risk (lower is worse)
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 2.6 |
| days to cover | 0.0 |
| volatility | 7.3 |
| implied vol | 0.0 |
| beta | 10.0 |
| debt equity | 9.4 |
| news risk | 6.0 |
- ▸High IV: 170%
- ▸Concentration risks: 3 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
5.4/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 3.5 |
| earnings history | 3.3 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| news activity | 5.0 |
- ▸Earnings concerns: 2B/2M
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (5)
- INSIDER:OK
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:36d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:3.9<4.5
- ASYMMETRY:-3.5=NEGATIVE
Warning (1)
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
Reward-to-Risk
-3.50
Upside
-17.5%
Downside
5.0%
Sizing output
AVOID
SetupRange Bound — RSI 58 mid-range, Bollinger mid-band
EdgeNo clear edge — No clear edge identified
SuitabilitySpeculative — Binary industry: Biotechnology
Investment implication
The F-path SELL output reflects an overall score of 5.4 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Peer rank at 6.5) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( MOMENTUM:3.9<4.5, ASYMMETRY:-3.5=NEGATIVE) reinforce the read. Current asymmetry R:R is -3.50 — supplementary context, not the trigger for this path.
The strongest dimensions are Peer rank at 6.5, Value at 6.3, and Growth at 6.2; the weakest are Momentum at 3.9, Sentiment at 4.1, and Insider at 4.6. The V9 engine flagged 2 failed gates with 1 warning, producing an asymmetric reward-to-risk of -3.50 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Wide Moat Quality Compounding
Trip ifPiotroski F-Score falls below 6 out of 9 or ROE drops below 30%.
- P2Consecutive Earnings Miss Streak
Trip ifBeat count exceeds miss count over the next 4 quarters with average surprise rising above 10%.
- P3Analyst Target Already Reached
Trip ifUpside to analyst target exceeds 10% after a new target revision.
- P4Negative Risk Reward Asymmetry
Trip ifAsymmetry ratio rises above 1.5 from the current -3.3.