What's Driving Sarepta's 26%+ Rally? A Deep Dive Into the Recent Stock Surge

Sarepta Therapeutics has turned heads with a noteworthy 26.4% climb over the past month, significantly outdistancing the broader S&P 500. Yet beneath this impressive chart move lies a more nuanced story. The company’s latest quarterly results painted a mixed picture—and whether this momentum holds depends on several critical factors ahead.

The Numbers Behind the Move

Here’s where things get interesting. In Q3 2025, Sarepta posted an adjusted loss of $0.13 per share, falling short of the Zacks consensus forecast of $0.01 per share. Year-over-year, adjusted EPS had deteriorated from $0.43, highlighting profitability headwinds. Once you include charges for depreciation, stock-based comp, and debt-related items, the loss widened to $1.80 per share versus $0.34 in the prior-year quarter.

Yet revenue told a different tale. The company generated $399.4 million in total sales, which despite representing a 15% year-over-year contraction, managed to beat analyst expectations of $352.6 million. This disconnect between earnings miss and revenue beat explains some of the post-report volatility.

Breaking Down Product Performance

Product revenues slipped 14% to $370.0 million. The three PMO therapies brought in $238.5 million (down 4% annually), surpassing both Zacks’ $225 million estimate and internal projections. Elevidys, the company’s flagship gene therapy, contributed $131.5 million—a 27% decline driven by the decision to halt shipments to non-ambulatory patients starting June 2025 due to safety concerns. Despite this headwind, Elevidys still exceeded consensus forecasts.

Collaboration revenue from the Roche partnership hit $29.3 million, off 22% year-over-year as contract manufacturing volumes contracted alongside lower Elevidys supply commitments.

On the cost side, adjusted R&D expenses climbed 3% to $206.5 million, reflecting increased pipeline investments and milestone payments. Conversely, adjusted SG&A expenses fell sharply by 23% to $77.1 million following the July restructuring initiative.

Guidance and Forward Outlook

Management maintains confidence in Elevidys generating at least $500 million in annual infusion revenue from the ambulant patient population through 2025. However, fourth-quarter volumes are expected to flatten or decline modestly, with market disruption and seasonality cited as factors. Full-year combined SG&A and R&D expenses are pegged at $420-$430 million, with a separate $200 million milestone payment anticipated for the second DM1 program, bringing total guidance to roughly $1.86 billion. Sarepta projects approximately $900 million from PMO therapy sales for the full year.

The Analyst Consensus Has Shifted

Since the earnings reveal, consensus estimates have moved lower, with a downward revision of 10.82%. The Zacks Rank currently sits at #3 (Hold), suggesting analysts expect neutral returns over the coming months. Across multiple metrics—Growth (F), Momentum (F), and Value ©—Sarepta’s aggregate VGM Score lands at F, indicating limited appeal to traditional value or growth strategies at current levels.

How Does This Stack Up Versus Peers?

Within the Medical - Biomedical and Genetics sector, Bristol Myers Squibb (BMY) has posted a more modest 5.8% gain over the same period. BMY reported Q3 revenues of $12.22 billion (up 2.8% year-over-year) with EPS of $1.63 versus $1.80 previously. Bristol Myers trades at a Zacks Rank #3 (Hold) with a superior VGM Score of A, showcasing stronger relative valuation appeal.

The Bottom Line

Sarepta’s quarter featured the classic earnings paradox: headline disappointment paired with operational positives. Whether the recent rally proves sustainable or represents a pull-back setup hinges on Elevidys adoption trends in the ambulant market and overall execution against $900 million PMO guidance. For now, the stock appears fairly valued at current levels rather than a compelling buy.