Rhythm Pharmaceuticals (RYTM) Stock Forecast & Price Target

Rhythm Pharmaceuticals concluded the third quarter of 2025 with a strengthened cash position of $416.1 million, marking a significant increase from $291 million at the end of the previous quarter. The anticipated positive outcomes from the Phase 3 Hypothalamic Obesity trial, coupled with the promising prospects of the next-generation oral drug bivamelagon, are expected to enhance the sales potential of IMCIVREE and drive substantial cash flows through at least 2040. Additionally, the recent failure of a competitor's treatment has improved the competitive landscape in the field of Prader-Willi syndrome, further supporting the positive outlook for Rhythm Pharmaceuticals' revenue growth.

Rhythm Pharmaceuticals faces significant risks that contribute to a negative financial outlook, including challenges in obtaining regulatory approval for its lead product, setmelanotide, to treat additional indications beyond existing ones and potential setbacks with earlier-stage drug candidates. The company reported 3Q25 revenue for IMCIVREE of $51.3 million, slightly below expectations, and suffers from declining market penetration among younger patients, indicating a potential limitation in its addressable patient population. Additionally, escalating operational expenses, with R&D and SG&A costs exceeding consensus estimates, alongside stagnant guidance for future operating expenditures, further strain financial stability and hinder profitability prospects.