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Supernus Pharmaceuticals (SUPN): Buy, Sell, or Hold Post Q4 Earnings?

By: StockStory

April 04, 2025 at 05:13 AM EDT

SUPN Cover Image

Supernus Pharmaceuticals has been treading water for the past six months, recording a small loss of 1.6% while holding steady at $31.52. However, the stock is beating the S&P 500’s 7% decline during that period.

Is now the time to buy Supernus Pharmaceuticals, or should you be careful about including it in your portfolio? Check out our in-depth research report to see what our analysts have to say, it’s free.

Despite the relative momentum, we don't have much confidence in Supernus Pharmaceuticals. Here are three reasons why you should be careful with SUPN and a stock we'd rather own.

Why Do We Think Supernus Pharmaceuticals Will Underperform?

With a diverse portfolio of eight FDA-approved medications targeting neurological conditions, Supernus Pharmaceuticals (NASDAQ: SUPN) develops and markets treatments for central nervous system disorders including epilepsy, ADHD, Parkinson's disease, and migraine.

1. Revenue Growth Flatlining

Long-term growth is the most important, but within healthcare, a stretched historical view may miss new innovations or demand cycles. Supernus Pharmaceuticals’s recent performance shows its demand has slowed as its revenue was flat over the last two years. Supernus Pharmaceuticals Year-On-Year Revenue Growth

2. Fewer Distribution Channels Limit its Ceiling

Larger companies benefit from economies of scale, where fixed costs like infrastructure, technology, and administration are spread over a higher volume of goods or services, reducing the cost per unit. Scale can also lead to bargaining power with suppliers, greater brand recognition, and more investment firepower. A virtuous cycle can ensue if a scaled company plays its cards right.

With just $661.8 million in revenue over the past 12 months, Supernus Pharmaceuticals is a small company in an industry where scale matters. This makes it difficult to build trust with customers because healthcare is heavily regulated, complex, and resource-intensive.

3. Revenue Projections Show Stormy Skies Ahead

Forecasted revenues by Wall Street analysts signal a company’s potential. Predictions may not always be accurate, but accelerating growth typically boosts valuation multiples and stock prices while slowing growth does the opposite.

Over the next 12 months, sell-side analysts expect Supernus Pharmaceuticals’s revenue to drop by 5.6%, a decrease from its flat sales for the past two years. This projection doesn't excite us and suggests its products and services will face some demand challenges.

Final Judgment

We cheer for all companies serving everyday consumers, but in the case of Supernus Pharmaceuticals, we’ll be cheering from the sidelines. Following its recent outperformance in a weaker market environment, the stock trades at 16.8× forward price-to-earnings (or $31.52 per share). This valuation tells us a lot of optimism is priced in - we think there are better opportunities elsewhere. We’d recommend looking at a safe-and-steady industrials business benefiting from an upgrade cycle.

Stocks We Would Buy Instead of Supernus Pharmaceuticals

The market surged in 2024 and reached record highs after Donald Trump’s presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.

While the crowd speculates what might happen next, we’re homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver’s seat and build a durable portfolio by checking out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 175% over the last five years.

Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like Sterling Infrastructure (+1,096% five-year return). Find your next big winner with StockStory today for free.

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