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MDU Resources Stock to Sell: Overleveraged and Struggling with Revenue Decline
ByAinvest
Wednesday, Oct 8, 2025 6:20 am ET1min read
MDU Resources is a utility and construction materials company with declining revenue and earnings per share over the last five years. It has a high debt-to-EBITDA ratio and a valuation ratio of 18x forward P/E. In contrast, United Therapeutics and Fidelis Insurance are growth stocks with exceptional revenue growth and improving returns on capital. United Therapeutics has a strong market share and is a free cash flow machine, while Fidelis Insurance provides customized coverage across various risk solutions.
United Therapeutics (UTHR) recently announced positive results from the TETON-2 phase 3 study, which demonstrated that nebulized Tyvaso® significantly improved lung function in patients with idiopathic pulmonary fibrosis (IPF) compared to placebo [1]. This breakthrough positions Tyvaso as a potential new treatment option for IPF and highlights advances in United Therapeutics' pulmonary disease pipeline.The strong TETON-2 data readout could reshape United Therapeutics' investment narrative and long-term market opportunity. The company is projected to reach $3.7 billion in revenue and $1.5 billion in earnings by 2028, assuming annual revenue growth of 6.6% and an increase in earnings of $0.3 billion from the current $1.2 billion [1]. However, the biggest short-term risk remains potential generic and branded competition, which could impact future earnings power.
United Therapeutics' recent $1 billion share repurchase program provides capital flexibility and can help counteract near-term pressures as the company awaits pivotal trial milestones and manages potential headwinds in its core pulmonary arterial hypertension (PAH) and pulmonary product lines [1]. The buyback program underscores the company's commitment to shareholder value and strategic positioning in the market.
Investors should be cautious about market share erosion from rising generic and branded alternatives, which could still impact future earnings power. Despite this, the strong TETON-2 results could unlock a major new market for Tyvaso, supporting long-term revenue growth and setting up high expectations for upcoming trial readouts.
The market's response to United Therapeutics' TETON-2 study results will be crucial in shaping the company's future trajectory. While the study's success opens up new opportunities, investors must remain vigilant about the competitive landscape and potential headwinds.
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