Buffett Brain · Research note
Score updated 26 Sept 2026 · analysis from 25 May 2026
HRMY· Healthcare
Harmony Biosciences Holdings
Harmony Biosciences shows strong growth potential with a solid ROIC of 18.1%, but concerns over management quality and valuation remain.
Buffett fit
Partial fit
Owner
69
Durability
82
Management
41
Price
43
Score updated 26 Sept 2026 · analysis from 25 May 2026
Buffett's checklist
Each number against Buffett's bar, and where it ranks among Healthcare stocks in our database.
How much profit the business makes on each dollar invested in it. Higher is better.
What is left of each sale after the cost of making the product. A high number often means pricing power.
The cash the business earns for its owners, compared with the price of the whole company.
How fast sales grew each year over the last five years.
How many years of today's profit you pay for at today's price. Lower means cheaper.
How much the company owes compared with what it owns outright. Lower is safer.
The four pillars
How the business measures up on each of Buffett's four tests.
If I owned Harmony Biosciences, I would focus on maximizing the potential of WAKIX and expanding into related therapies.
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Harmony's 5-year average of 18.1% is impressive, especially in a sector where the top-quintile cutoff is only 6.3%.
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The share count has remained flat over the past five years, indicating management is not diluting shareholder value.
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With an yield of 20.14%, the valuation appears attractive compared to the target range of 8-10%.
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For and against
The strongest points on each side, with the numbers behind them.
In its favor
5- 1 of 18.1% places Harmony in the top-quintile of its sector, indicating strong capital efficiency.
- 2Revenue CAGR of 29.85% over the last five years shows robust growth potential.
- 3 has grown 59.09% YoY, highlighting strong cash generation capabilities.
- 4Current ratio of 3.58 suggests excellent liquidity to cover short-term obligations.
Concerns
5- 1Management quality score of 41 raises red flags about their ability to effectively allocate capital.
- 2 of 76.55% is below the sector's top-quintile cutoff of 77.8%, indicating competitive pressure.
- 3 of 11.8 may imply limited upside potential if growth expectations are not met.
- 4The company lacks a clearly defined , making it vulnerable to competitive threats.
Price history
$36.03-13.1%· 5-year return
Weekly closing prices. Touch or hover the line for a date.
The business
How the business works
Harmony Biosciences develops therapies for rare neurological disorders, with its primary product, WAKIX, generating $868.45M in revenue. The company has a strong focus on a niche market, which can lead to high margins. The stands at 76.55%, suggesting excellent unit economics.
How this analysis has moved
The call has held across 5 reviews.
Sep 27, 2026 → Oct 22, 2026
What other investors would say
The same company, judged by three other documented playbooks.
Keep researching
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