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ALNY, Alnylam

Pharmaceuticals consumer brand Distress / turnaround

Alnylam is a global commercial-stage biopharmaceutical company developing novel therapeutics based on ribonucleic acid interference, or RNAi.

For delivery to the central nervous system, or CNS, and the eye (ocular delivery), we are utilizing an alternative conjugate approach based on a hexadecyl (C16) moiety as a lipophilic ligand.

Latest annual: FY2025 10-K

ALNY · Alnylam

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2025

$3.7B

+65.2% YoY · 50% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $3.7B 5-yr avg $1.9B

Gross margin 82% 5-yr avg 85%

Operating margin 13.5% 5-yr avg −33.9%

Owner-earnings margin 13% 5-yr avg −25%

Free cash flow margin 13% 5-yr avg −26%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

Situation: Distress / turnaround. Thin interest coverage, or operating cash burned against real debt, across the record. The balance sheet carries this situation; the debt schedule sets the clock.
What moves the needle: Operating margin has reached 14% at its best but run negative through the cycle (median −168%) on a 86% gross margin — so the question is which reading is truer: whether the median was pulled below zero by one-off charges, by the cycle, or by spending it is still growing into, and whether it settles back at a profit. Stock-based pay runs about 22% of sales, a real and recurring claim on owners that the GAAP margin understates. Read this kind of business on the pipeline against the patent cliff, and pricing. On its own account, the filing leans hardest on pricing power & competition, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on capital has rarely cleared the cost of capital (median −83%, above 15% in 0 of 7 years). Owner earnings, the cash-based check, have been thin too. This is price-taker territory, where the balance sheet and the cycle matter more than any multiple; the rest is in the 10-K.

Every line is arithmetic on the company's filings, shown in full in the sections below.

The record

Ten years of arithmetic, read across the cycle.

The record, 2016–2025

realized figures from each filing · older years to the left

2016’16	2017’17	2018’18	2019’19	2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMDec 2025
											Income statement
$47M	$90M	$75M	$220M	$493M	$844M	$1.0B	$1.8B	$2.2B	$3.7B	$3.7B	RevenueRevenue
—	100%	—	89%	85%	86%	86%	85%	86%	82%	82%	Gross marginGross mgn
189%	222%	510%	218%	119%	74%	74%	44%	43%	33%	33%	SG&A / revenueSG&A/rev
811%	434%	675%	298%	133%	94%	85%	55%	50%	36%	36%	R&D / revenueR&D/rev
($425M)	($500M)	($815M)	($939M)	($828M)	($709M)	($785M)	($282M)	($177M)	$502M	$502M	Operating incomeOp. inc.
−900.3%	−556.2%	n/m	−427.5%	−168.1%	−83.9%	−75.7%	−15.4%	−7.9%	13.5%	13.5%	Operating marginOp. mgn
($410M)	($491M)	($761M)	($886M)	($858M)	($853M)	($1.1B)	($440M)	($278M)	$314M	$314M	Net incomeNet inc.
											Cash flow & returns
($308M)	($383M)	($563M)	($278M)	($615M)	($642M)	($541M)	$104M	($8M)	$524M	$524M	Operating cash flowOp. cash
$15M	$13M	$15M	$17M	$35M	$48M	$44M	$54M	$57M	$56M	$56M	DepreciationDeprec.
$12M	$2M	$26M	$416M	$69M	($2M)	$315M	$269M	($59M)	($194M)	($194M)	Working capital & otherWC & other
$65M	$104M	$127M	$140M	$70M	$76M	$72M	$62M	$34M	$59M	$59M	CapexCapex
136.9%	115.9%	169.4%	63.8%	14.3%	9.0%	6.9%	3.4%	1.5%	1.6%	1.6%	Capex / revenueCapex/rev
($323M)	($396M)	($578M)	($296M)	($650M)	($689M)	($586M)	$42M	($43M)	$465M	$465M	Owner earningsOwner earn.
−684.6%	−440.6%	−771.4%	−134.5%	−131.8%	−81.6%	−56.5%	2.3%	−1.9%	12.5%	12.5%	Owner earnings marginOE mgn
($372M)	($487M)	($690M)	($419M)	($685M)	($718M)	($613M)	$42M	($43M)	$465M	$465M	Free cash flowFCF
−789.4%	−541.6%	−920.5%	−190.5%	−139.1%	−85.0%	−59.1%	2.3%	−1.9%	12.5%	12.5%	Free cash flow marginFCF mgn
-38%	-34%	-71%	-83%	-92%	-126%	—	—	-112%	—	—	ROICROIC
-45%	-28%	-58%	-62%	-84%	-145%	—	—	-415%	40%	40%	Return on equityROE
−45%	−28%	−58%	−62%	−84%	−145%	—	—	−415%	40%	40%	Retained to equityRetained/eq
											Balance sheet
$194M	$645M	$420M	$547M	$497M	$820M	$866M	$813M	$966M	$1.7B	$1.8B	Cash & investmentsCash+inv
$23M	$34M	$19M	$43M	$102M	$199M	$238M	$328M	$405M	$778M	$778M	ReceivablesReceiv.
—	—	$24M	$56M	$75M	$86M	$129M	$89M	$79M	$83M	$83M	InventoryInvent.
$54M	$28M	$60M	$50M	$52M	$73M	$98M	$56M	$88M	$116M	$116M	Accounts payablePayables
($31M)	$6M	($17M)	$49M	$126M	$212M	$269M	$361M	$395M	$745M	$745M	Operating working capitalOper. WC
$672M	$1.8B	$1.2B	$1.7B	$2.6B	$2.8B	$2.7B	$3.0B	$3.3B	$4.1B	$4.1B	Current assetsCur. assets
$132M	$144M	$179M	$353M	$585M	$696M	$768M	$968M	$1.2B	$1.5B	$1.5B	Current liabilitiesCur. liab.
5.1×	12.2×	6.7×	4.9×	4.5×	4.0×	3.5×	3.1×	2.8×	2.8×	2.8×	Current ratioCurr. ratio
$1.3B	$2.0B	$1.6B	$2.4B	$3.4B	$3.6B	$3.5B	$3.8B	$4.2B	$5.0B	$5.0B	Total assetsAssets
$150M	$30M	$30M	$0	$191M	$676M	$1.0B	$1.0B	$1.0B	$1.0B	$1.0B	Total debtDebt
($44M)	($615M)	($390M)	($547M)	($305M)	($144M)	$151M	$208M	$58M	($649M)	($814M)	Net debt / (cash)Net debt
—	—	—	—	-9.8×	-5.0×	-5.0×	-2.3×	-1.2×	2.0×	2.0×	Interest coverageInt. cov.
$920M	$1.8B	$1.3B	$1.4B	$1.0B	$588M	($158M)	($221M)	$67M	$789M	$789M	Shareholders’ equityEquity
160.2%	103.2%	210.6%	79.6%	28.4%	19.6%	22.2%	12.1%	12.1%	9.4%	9.4%	Stock comp / revenueSBC/rev
											Per share
85.6M	90.6M	101M	109M	115M	118M	122M	125M	128M	135M	135M	Shares out (diluted)Shares
$0.55	$0.99	$0.74	$2.01	$4.29	$7.13	$8.53	$14.64	$17.61	$27.58	$27.58	Revenue / shareRev/sh
$-4.79	$-5.42	$-7.57	$-8.11	$-7.46	$-7.20	$-9.30	$-3.52	$-2.18	$2.33	$2.33	EPS (diluted)EPS
$-3.77	$-4.37	$-5.74	$-2.71	$-5.65	$-5.82	$-4.81	$0.34	$-0.33	$3.46	$3.46	Owner earnings / shareOE/sh
$-4.35	$-5.38	$-6.85	$-3.83	$-5.96	$-6.06	$-5.04	$0.34	$-0.33	$3.46	$3.46	Free cash flow / shareFCF/sh
$0.75	$1.15	$1.26	$1.28	$0.61	$0.64	$0.59	$0.50	$0.27	$0.44	$0.44	Cap. spending / shareCapex/sh
$10.75	$19.51	$12.94	$13.17	$8.84	$4.97	$-1.30	$-1.77	$0.53	$5.86	$5.86	Book value / shareBVPS

Per-share growththe realized rate an owner's share compounded

	9-yr	5-yr
Revenue / share	+54.5%/yr	+45.1%/yr
Capital spending / share	−5.9%/yr	−6.6%/yr
Book value / share	−6.5%/yr	−7.9%/yr

The record, charted

FY2016–2025

Each measure over its full record; the current point and the worst year marked.

Share count

135Mpeak FY2025

ROIC

−112%low FY2021

Gross margin

82%low FY2025

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

$465Mowner earningsvs.$314Mnet incomelow FY2021

Owner-earnings bridge

FY2021–FY2025cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2025 the business turned $314M of profit into $465M of owner earnings: more cash than the profit line showed, after the non-cash charges and the capital it put back in.

Reported net income$314M

Owner earnings$465M · 13% of revenue

	FY2025	FY2024	FY2023	FY2022	FY2021
Reported net income	$314M	($278M)	($440M)	($1.1B)	($853M)
Depreciation & amortizationnon-cash charge added back	+$56M	+$57M	+$54M	+$44M	+$48M
Stock-based compensationreal costnon-cash, but a real cost	+$348M	+$272M	+$222M	+$231M	+$166M
Working capital & othertiming of cash in and out, other non-cash items	−$194M	−$59M	+$269M	+$315M	−$2M
Cash from operations	$524M	($8M)	$104M	($541M)	($642M)
Maintenance capital expenditurethe spending needed just to hold position and volume	−$59M	−$34M	−$62M	−$44M	−$48M
Owner earnings	$465M	($43M)	$42M	($586M)	($689M)
Growth capital expenditurediscretionary; spent to get bigger, not to stand still	—	—	—	−$28M	−$29M
Free cash flow	$465M	($43M)	$42M	($613M)	($718M)
Owner-earnings marginowner earnings ÷ revenue	13%	-2%	2%	-56%	-82%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the capital it must spend to hold its position . The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $348M), owner earnings is nearer $117M.

Much of fiscal 2025's profit didn't arrive as operating cash; it sits in “working capital & other” above. That can be a real inventory or timing swing, or profit that doesn't run through operating cash at all: a heavy tax year, equity-method earnings, or investment income booked through investing. For a year like this, owner earnings understates the cash earned; the full cash-flow statement carries the rest.

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 10-K · source on SEC EDGAR →

Will it survive?

Can it pay its interest? 2.0×

Thin

Operating income $502M ÷ interest expense $253M

What this means
Operating profit covers interest, but with little room. A bad year, a refinancing at higher rates, or a revenue wobble closes the gap fast.
How heavy is the debt, net of cash? +$649M

Net cash

Cash $1.7B − debt $1.0B

What this means
Cash and short-term investments exceed every dollar of debt by $649M, on net the company owes nothing, and can act from strength when others can't. It also holds $103M in longer-dated marketable securities; counting those, it sits at net cash of $753M. Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? 59d

Tight

DSO 76 + DIO 45 − DPO 62 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash.

Is it a good business?

Return on invested capital -83%

Below average through the cycle

7-yr median, range -126%–-34%; the latest year is left out — large non-operating charges put its operating line well above pretax profit

Industry peers: median 1%

What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 7 years, so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
Owner-earnings margin 13%

Positive this year, negative across the cycle

latest $465M = operating cash $524M − maintenance capex $59M (positive this year), after an earlier loss stretch (10-yr median -132%)

Industry peers: median 6%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 13% of revenue this year, a -132% median across 10 years. Treating stock comp as the real expense it is (less $348M of SBC) leaves $117M.
Are earnings backed by cash? 1.67×

Cash-backed

Cash from ops $524M ÷ net income $314M

What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.

How is the cash used?

Where do the earnings go? —

Not enough data

What this means
The filing data didn't include the inputs for this check.
Investing or harvesting? 1.05×

Maintaining

Capex $59M ÷ depreciation $56M

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 3 of 5 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Pass

Revenue ≥ $2B · $3.7B

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Pass

Current ratio ≥ 2× · 2.76×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Conservative debt Pass

Debt ≤ working capital · $1.0B vs $2.6B WC

What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
Earnings stability Miss

A profit every year (10-yr record) · 9 loss years

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Miss

Uninterrupted dividends · none paid

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth —

Earnings +33% over the record · —

What this means
Earnings were negative early in the record, a growth rate isn't meaningful.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $-1.02/share (latest year $2.37), the averaged base the calculator's gate runs on, and book value is $5.95/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2016–2025

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 1 of 10

What this means
Lost money in 9 year(s), look at what happened there before trusting the average.
Return on capital ≥ 15% 1 of 8 yrs

What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
Operating margin −848% → −3% (3-yr avg ends)

In the filing’s words The record and the words agree: the margin widened and the filing attributes the gain to its own pricing, not volume alone.

What this means
Through the cycle the operating margin widened — about −848% early to −3% lately, median −168% — pricing power intact or improving.
Reinvestment, incremental ROIC returns capital

What this means
The capital base barely grew: this business returns cash through dividends and buybacks rather than reinvesting. Judge it on the cash returned, not on compounding.
Worst year 2018 · −1087.6% op. margin

What this means
Operations went underwater in 2018, understand why before trusting the good years.
Share count +5.2%/yr

What this means
The share count is rising, dilution works against you on a per-share basis.

Does AI threaten the moat?

Low contestability

The moat is physical, regulated or balance-sheet-funded, the kind AI cuts costs within but does not contest.

AI is unlikely to contest a moat that is physical, regulated or balance-sheet-funded; here it reads more as a cost tool than a threat.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of fiscal year-end, Dec 31, 2025

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$4.1B

Cash & short-term investments$1.7B
Receivables$778M
Inventory$83M
Other current assets$1.5B

Current liabilities$1.5B

Accounts payable$116M
Other current liabilities$1.4B

Current ratio2.76×all current assets ÷ what's due · Graham looked for 2×

Quick ratio2.71×stricter: inventory excluded

Cash ratio1.13×strictest: cash alone against what's due

Working capital$2.6Bthe cushion left after near-term bills

Revenue, latest quarter vs. a year ago+149.3%the freshest read on whether the business is still growing

Current ratio, recent quarters3.2× → 2.8×

Deeper floors

Tangible book value$789Mequity stripped of goodwill & intangibles

Net current asset value($126M)Graham's net-net: current assets less all liabilities

Debt incl. operating leases$948M$271M of it operating leases

Deferred revenue$5Mcustomer cash collected before delivery; operating float

From the company's latest filing.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Chief executive	Pay, as filed	“Actually paid”	Owner earnings
2021	John M. Maraganore, Ph.D.	$10.2M	$17.5M	($689M)
2022	—	$4.6M	$19.0M	($586M)
2023	Yvonne L. Greenstreet, M.D.	$8.9M	$11.4M	$42M
2024	—	$11.5M	$29.8M	($43M)
2025	—	$14.9M	$77.4M	$465M

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years. A dash under the name means the filing tags the figure without naming the officer.

Insider ownership<1%
The stake all directors and executive officers hold together, per the 2026 proxy: skin in the game, the first thing Munger reads.
CEO pay ratio48:1
What the chief earns for every dollar the median employee makes, per the 2026 proxy. A high ratio alone settles nothing; some businesses are genuinely top-heavy in scarce skill. A runaway figure is where Buffett starts asking whether the board is doing its job.
Stock-based compensation$348M
The slice of the business handed to employees in shares this year, 9% of revenue, equal to 69% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.

Inverting the record

Invert: instead of why Alnylam is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2016–2025.

1 of the 3 tests turned up something to look into; the other 2 came back clean.

Look hereDid debt outgrow the business?$150M → $1.0B
Debt rose from $150M to $1.0B while owner earnings went from about ($432M) to $155M: measured against what the business earns, the balance sheet carries more debt than it did. Debt raised for buybacks or deals rather than growth is the kind that bites in a downturn.

And these came back clean

Is it less profitable than it was?
Did receivables and inventory outpace sales?

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

What an owner would ask, FY2025

read the 10-K →

Which reported numbers are a judgment call?
Management names Revenue recognition as critical estimates
each rests partly on management's judgment; the filing's note sets out the assumptionsverify →

The questions the record and the charts do not answer on their own; each carries the figure and the place to look.

Peers, Pharmaceuticals

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
ONCBeOne Medicines Ltd.	$5.3B	86%	-124.4%	-46%	-112%
ELANElanco Animal Health Incorporated	$4.7B	54%	-3.2%	-1%	4%
JAZZJazz Pharmaceuticals	$4.3B	—	16.8%	8%	35%
PRGOPerrigo Company plc	$4.3B	36%	3.9%	1%	6%
ALNYAlnylam	$3.7B	86%	-126.0%	-83%	-107%
BMRNBioMarin	$3.2B	78%	-1.7%	-1%	1%
UTHRUnited Therapeutics	$3.2B	92%	47.5%	20%	39%
AMRXAmneal Pharmaceuticals Inc.	$3.0B	37%	7.9%	3%	9%
Group median	—	78%	1.1%	0%	5%

The price

What a price has to assume.

What the price implies

reverse-DCF

Type today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Alnylam has delivered.

Today’s price $

Base Normalize · through-cycle ($155M) Net of stock comp (−$348M)

—

The assumptions Required return 9% Years of high growth 10 Terminal growth 2.5%

9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.

Enter a price above to run it.

Implied by the price—

Owner-earnings growth, delivered—

Owner-earnings yield—

P/E (3-yr earnings ’23–’25)—

P/B—

Graham’s price gate—

Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.

Against a high-grade bond: Graham’s yardstick bond yield%

Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.

Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.

Owner earnings $465M on 133M shares outstanding, per the 10-K cover, as of 2026-02-06; net cash $814M. The base is the latest year by default; Normalize values it on the through-cycle median owner-earnings margin (to avoid paying on a peak year). Net of stock comp treats option pay as the expense it is. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.

Weigh ALNY against another business →

The owners of ALNY: the meeting and the votes →

Cite: Owner Scorecard, "Alnylam (ALNY), the owner's record," https://ownerscorecard.com/c/ALNY, data as of 2026-07-09.

Manual order: ← ALNT its page in the Manual ALOY →

Industry order: ← ALMS the Pharmaceuticals chapter ALT →