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Royalty Pharma: A Potentially Long-Term Dividend Investment

May 04, 2021 8:00 AM ETRoyalty Pharma plc (RPRX)9 Comments


  • Royalty Pharma is a new type of healthcare company.
  • They buy up royalties from other biopharma and have many blockbusters in their portfolio.
  • They pay a small dividend, which, if it increases over the years, maybe a good thing.
  • Looking for more investing ideas like this one? Get them exclusively at The Total Pharma Tracker. Learn More »

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Royalty Pharma Plc (NASDAQ:RPRX) is a different kind of biopharma company. Instead of doing biopharma the normal, risky way - discovering a molecule, running it through the lab, conducting an expensive clinical trial, producing vague data and then abandoning

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This article was written by

Avisol Capital Partners profile picture

Avisol Capital Partners is made up of a team of medical experts, finance professionals and techies, all of whom invest their own money in the picks they share. They aim to help readers find the middle ground between value and growth investing, as they demystify the biopharma industry.

They lead the investing group Total Pharma Tracker where they offer a monthly updated catalyst database, an investability scoring system for quick reference ideas, and direct access in chat for dialogue and questions. Learn more.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, but may initiate a long position in RPRX over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (9)

How do you compare it to HCRX that is coming public?
Been long since the IPO and coming up on 1-year without great price action. Hoping for increased dividends over time and more visibility from the market on what this company does. Still a planned hold for at least a couple years.
Wonder how it would do in a higher inflation environment? As a royalty business its cost I assume doesn’t go up but its debt interest rate might.
@Phiota I think should be fine. RPRX has been taking advantage of the current environment by issuing long dated bonds with fixed rate, so higher rate in the future wouldn't hurt them unless they want to issue more bonds.
ComputerBlue profile picture
Currently long..fills a nice niche spot within the portfolio
NeoContrarian profile picture
Apologies if I missed something but do they have a net debt or net cash position?
Avisol Capital Partners profile picture
@NeoContrarian Way more debt than cash. Net debt $3bn, probably more.
@NeoContrarian 2.4x net debt to ebitda
Grant Nelson profile picture
@MUGSLEY that is manageable
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