IP Group Share Discount Highlights Pfizer-Linked Upside, Says Edison

IP Group (LON: IPO) shares offer what Edison described in a note on Monday as a “compelling asymmetric return profile” due to the company’s exposure to future income streams from Metsera’s anti-obesity drugs, acquired by Pfizer in 2025 for up to $10 billion.

Edison analyst Milosz Papst wrote the current IP Group share price, which is trading at a 54% discount to end-2025 NAV, implies “only c £250m fair value” for the company’s private portfolio.

That represents “a discount of close to 70% to end-2025 valuations.” Edison noted that at least 73% of this implied value is covered by expected exits in 2026–27, after management reiterated its target of “more than £250m in proceeds between FY25 and FY27,” including £68.1 million already realised in FY25.

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This leaves “no more than £68m (or 7.7p/share)” attributed to the remaining unrealised private portfolio, including Metsera-related IP.

Edison said IP Group delivered a 13% NAV total return in FY25, driven by a £126.4 million increase in the value of Metsera’s IP, which offset reductions related to funding issues and Pulmocide’s failed Phase III trial.

Metsera’s pipeline includes GLP-1 candidate PF’3944, now in Phase III, which Edison describes as a “multibillion dollar revenue opportunity.” IP Group’s valuation assumes a 53% probability of success, a 2028 potential launch and peak sales of $3.5 billion.

Edison also highlighted exits such as Hinge Health, which delivered a “53x multiple on invested capital,” supporting its view that IP Group stock remains undervalued.