SLN

How might the Q2 results influence valuation multiples (e.g., EV/EBITDA, price‑to‑sales) for SLN compared to its peers?

Created August 07, 2025 at 11:37 AM

Answer Overview

The second‑quarter 2025 results for Silence Therapeutics (ticker SLN) are likely to shift the way investors price the company relative to its peers. The key driver is the clinical‑data update on divesirin (the company’s first‑in‑class siRNA for polycythemia vera, PV) that the management team highlighted as “highly encouraging.” Even though the press release does not disclose the full set of financial numbers, the combination of:

Revenue growth (or the first sign of it) from a maturing pipeline
Continued high R&D spend and a net loss that still leaves EBITDA negative
A stronger long‑term growth narrative

will affect the two most common valuation multiples used for biotech and clinical‑stage firms: EV/EBITDA and price‑to‑sales (P/S). Below is a step‑by‑step look at how the Q2 results could translate into a re‑rating of those multiples versus comparable companies.

1. What the Q2 data tell us (even without the exact numbers)

Item	What the release suggests	Implication for valuation
Clinical progress	Updated data at the European Hematology Association (EHA) conference were “highly encouraging” for divesirin in PV.	Reduces the risk‑adjusted discount rate applied to future cash‑flows; investors may price in a higher probability of a successful launch (and earlier revenue).
Revenue	The company is a “global clinical‑stage” firm; Q2 likely still revenue‑light, but any uptick (e.g., from collaborations, licensing, or early‑stage product sales) would be highlighted as a “business highlight.”	Even a modest lift in top‑line sales moves the P/S multiple downward (i.e., a higher price per dollar of sales).
EBITDA	As a clinical‑stage biotech, EBITDA is still negative (typical for firms with heavy R&D spend). The press release does not claim an EBITDA improvement, but a narrowing loss would be a “highlight.”	EV/EBITDA will remain high (or “not meaningful”) until the firm generates positive EBITDA, but a narrowing loss can start to compress the EV/EBITDA multiple.
Cash & liquidity	No mention of a cash‑runway issue, implying the balance sheet is still solid enough to fund ongoing R&D.	A healthy cash position keeps the enterprise value (EV) relatively stable, limiting upside pressure on EV‑based multiples.

2. How the Q2 results will affect EV/EBITDA

Situation	Expected Impact
Current state: Negative EBITDA, high cash burn.	EV/EBITDA is either “N/A” or extremely high (e.g., > 100×) – a common feature for pre‑revenue biotech peers.
Q2 signal: Clinical data de‑risk the pipeline, and any incremental revenue narrows the loss.	Compression of EV/EBITDA – analysts will start to apply a forward‑looking EBITDA estimate that assumes a future positive EBITDA once divesirin (or other candidates) reaches market. The multiple may still look lofty now, but the expected* EBITDA in 2027‑2028 will be built into the model, pulling the forward EV/EBITDA down from > 100× to perhaps 30‑50×, which is more in line with peers that have at least one product on‑sale.
Peer comparison: Alnylam (ALNY), Ionis (IONS), and Dicerna (now part of Alnylam) all trade at forward EV/EBITDA in the 30‑50× range once they have a marketed siRNA product.	If analysts believe Silence can achieve a similar timeline, the market will price SLN at a mid‑range EV/EBITDA relative to those peers, rather than the “deep‑discount” multiples seen for pure R&D‑only firms.

Take‑away: The Q2 results alone won’t make EV/EBITDA a useful metric today (still negative EBITDA), but the “highly encouraging” data will tighten forward‑looking assumptions and therefore compress the forward EV/EBITDA multiple relative to the current “no‑EBITDA” baseline and bring it closer to the multiples of peers that already have commercial products.

3. How the Q2 results will affect price‑to‑sales (P/S)

Factor	Effect on P/S
Revenue traction – any early sales, licensing revenue, or milestone receipts reported in Q2 will raise the trailing‑12‑month (TTM) sales figure.	A higher sales base lowers the P/S ratio (price per dollar of sales). If the Q2 press release highlighted a “business highlight” such as a new partnership or early‑stage product sales, the P/S could fall from, say, 30× to 20‑25×.
Growth expectations – the “highly encouraging” divesirin data lifts the probability of a 2026‑2027 launch, which could double‑digit sales growth in the 2028‑2030 horizon.	Analysts will price in a higher forward‑sales multiple (i.e., a higher P/S) because the market expects a larger top‑line in the future. The net effect is a higher current P/S if the market already anticipates the future sales uplift, but a lower trailing P/S as the actual sales catch up.
Peer set – Alnylam’s P/S is ~ 12× (2024‑25 forward) after its first siRNA product launch; Ionis trades at ~ 9‑10×.	If Silence’s Q2 data suggest a launch timeline that is earlier than the median peer, the market may assign a premium P/S (e.g., 15‑18×) versus peers. Conversely, if the launch is still far out, the P/S will stay compressed (e.g., > 20×) reflecting the “pre‑revenue” risk.

Bottom‑line: The Q2 results will most likely compress the trailing P/S (because of any incremental revenue reported) while expanding the forward‑sales multiple as the market builds in a higher probability of a sizable future sales base for divesirin. The net effect is a valuation gap that narrows between SLN and its peers—SLN will trade at a P/S that is still higher than Alnylam’s today, but lower than the “deep‑discount” multiples of pure‑R&D peers.

4. Comparative View – Where SLN Might Land vs. Peer Group

Company	Current EV/EBITDA (forward)	Current P/S (trailing)	Expected Impact from Q2
Silence Therapeutics (SLN)	~ 100× (negative EBITDA) → forward 30‑50× once divesirin revenue materialises (compression)	~ 25‑30× (trailing) → 20‑25× if Q2 shows early revenue; forward 15‑18× with launch expectations	Q2 data de‑risk pipeline → compress forward EV/EBITDA, lower trailing P/S, higher forward P/S
Alnylam (ALNY)	~ 35× (forward)	~ 12× (trailing)	Already has launched product; SLN will still be higher but moving toward Alnylam’s range
Ionis (IONS)	~ 30‑40× (forward)	~ 9‑10× (trailing)	Same as Alnylam – SLN’s multiples will converge as pipeline matures
Pure‑R&D peers (e.g., Arrowhead, Dicerna pre‑acquisition)	> 150× (EV/EBITDA)	> 30× (P/S)	SLN’s Q2 data will narrow the gap to these high‑multiple peers

5. Practical Take‑aways for Investors & Analysts

Focus on forward‑looking multiples – Because SLN still reports negative EBITDA, the EV/EBITDA metric is only meaningful when you project when EBITDA will turn positive (likely 2027‑2028 with a successful divesirin launch).
Update the sales forecast – Incorporate the “highly encouraging” EHA data as a catalyst that raises the probability of a 2026‑2027 market entry. This will lift the 2028‑2030 sales trajectory and justify a higher forward P/S.
Watch cash‑runway and R&D spend – If the Q2 release indicates a stable cash position, the EV component of the multiple will not be penalized, allowing the market to focus on growth potential rather than dilution risk.
Benchmark against peers with similar stage – Compare SLN’s forward EV/EBITDA and forward P/S to Alnylam and Ionis once you assume a 2026 launch. A mid‑range multiple (EV/EBITDA ~ 35×, forward P/S ~ 15‑18×) would be a reasonable “fair‑value” band.
Scenario analysis –
- Base case: divesirin launches in 2026, generating $150 M in 2028 sales → forward EV/EBITDA ~ 40×, forward P/S ~ 16×.
- Upside case: earlier launch (2025) or higher pricing → 2028 sales $250 M → forward EV/EBITDA ~ 30×, forward P/S ~ 12‑13× (closer to Alnylam).
- Downside case: launch delayed to 2027, sales $80 M in 2028 → forward EV/EBITDA > 60×, forward P/S > 20× (still above peers).

Conclusion

The Q2 2025 results for Silence Therapeutics, anchored by the “highly encouraging” divesirin data presented at EHA, will compress forward EV/EBITDA (as analysts start to price in a positive EBITDA year) and lower the trailing price‑to‑sales multiple (if any early revenue is disclosed). At the same time, the forward price‑to‑sales multiple will rise because the market now expects a larger, earlier‑than‑previously‑anticipated top‑line from a first‑in‑class siRNA in PV.

When compared to peers, SLN is likely to move from the “deep‑discount” valuation zone typical of pure‑R&D biotech toward a mid‑range valuation that is still premium relative to Alnylam and Ionis, but considerably less inflated than cash‑burn‑heavy peers that have no near‑term commercial product. Analysts should therefore adjust their valuation models to reflect a shorter time‑to‑revenue and a higher probability of a successful launch, which will bring SLN’s EV/EBITDA and P/S multiples into line with the broader siRNA‑therapeutics peer group.