Sanofi’s SNY stock has declined 5.9% in the past three months despite reporting double-digit sales and earnings growth in the first quarter because investors are increasingly focused on its long-term growth challenges rather than its current earnings performance. While the company continues to benefit from strong sales of its blockbuster drug Dupixent, pipeline setbacks and uncertainty over future growth drivers have created some pressure on the shares.
The recent pullback may leave investors wondering whether to exit the stock, hold their position, or use the dip as an opportunity to accumulate more shares.
Let’s understand the company’s strengths and weaknesses to better analyze how to play Sanofi stock amid this scenario.
Dupixent: A Key Top-Line Driver for SNY
Sanofi and Regeneron’s REGN immunology drug, Dupixent, holds the number one new-to-brand prescription market share across all its approved indications in the United States.
Dupixent is now approved in several countries for nine diseases, driven partly by type II inflammation, namely severe chronic rhinosinusitis with nasal polyposis, severe asthma, moderate-to-severe atopic dermatitis, eosinophilic esophagitis, prurigo nodularis, chronic obstructive pulmonary disease, chronic spontaneous urticaria, bullous pemphigoid and allergic fungal rhinosinusitis.
Dupixent generated sales of €4.17 billion in the first quarter of 2026, up 30.8% year over year. Dupixent’s strong sales growth is being driven by demand across all geographies, newly approved indications and demographics. Sanofi expects Dupixent to achieve around €22 billion in sales in 2030.
Dupixent is also being studied in late-stage studies for lichen simplex chronicus and chronic pruritus of unknown origin.
Sanofi and Regeneron aim to sustain long-term value creation for Dupixent through a three-pronged strategy of defending its patent portfolio, extending the product’s lifecycle via improved dosing options, and innovating with new molecules leveraging its existing alliance infrastructure.
SNY Boasts a Strong Vaccine Segment
Sanofi possesses one of the world’s leading vaccine operations, with total annual sales of more than €5 billion in the past five years. In the first quarter of 2026, total vaccine sales increased 2.1% to €1.29 billion.
Sanofi continues to expand its vaccine business further with its pipeline comprising multiple programs across pneumococcal disease, yellow fever, meningitis, RSV and pandemic preparedness. Some vaccine candidates that are in phase III development include a 21-valent pneumococcal conjugate vaccine and a next-generation rabies vaccine. Sanofi expects annual net sales to be more than €10 billion from its Vaccines unit by 2030, backed by its innovation efforts.
SNY’s New Products & Strong Pipeline Can Drive Long-Term Growth
Sanofi is seeing a good uptake of its new medicines like novel recombinant factor VIII therapy, Altuviiio and cancer drugs, Ayvakit and Sarclisa.
Sales of its newly launched medicines and vaccines grew 34% in 2025. Beyfortus (in partnership with AstraZeneca [AZN]) achieved blockbuster sales in its first full year of sales in 2024 and continues its expansion into new geographies. Altuviiio achieved blockbuster sales in 2025, and Ayvakit, added from the Blueprint Medicines acquisition, is expected to become the next blockbuster drug in 2026.
A key new product, Wayrilz (rilzabrutinib), was approved for treating immune thrombocytopenia in 2025. Sanofi’s new drug application (NDA) seeking approval for venglustat for Gaucher Disease is under the FDA’s priority review, with a decision expected in November. Venglustat is also under regulatory review in the EU.
Key late-stage pipeline candidates are tolebrutinib for non-relapsing secondary progressive multiple sclerosis, amlitelimab, an anti-OX40L mAb for moderate-to-severe atopic dermatitis and lunsekimig across multiple respiratory indications. Sanofi’s regulatory application seeking approval of tolebrutinib was issued a complete response letter (CRL) in December. For amlitelimab, a regulatory filing is expected in the second half of 2026.
Competitive Pressure on SNY’s Vaccines
Sales of Sanofi’s influenza vaccines, which represent around 30% of Sanofi’s Vaccines sales, declined in 2024 and 2025, due to rising competitive and pricing pressure. Intense pricing pressure and lower vaccine coverage can continue to hurt sales of influenza vaccines in future quarters. Competitive pressures, in particular in the United States and in Germany, can hurt flu vaccine sales in future quarters. Sanofi believes that the influenza market is likely to have several new competitive entrants, both from standalone flu mRNA and COVID-flu combinations.
Competition for Beyfortus, which represented 22.4% of vaccine sales in 2025, has increased with the launch of Merck’s MRK newly approved monoclonal antibody, Enflonsia, in 2025.
SNY’s Price, Valuation & Estimate Movement
Sanofi’s stock has declined 12.6% year to date compared with a decrease of 0.4% for the industry. The stock has also underperformed the sector and the S&P 500, as seen in the chart below.
SNY Stock Underperforms Industry, Sector and S&P 500
From a valuation standpoint, Sanofi appears attractive relative to the industry. Going by the price/earnings ratio, the company’s shares currently trade at 8.35 forward earnings, lower than 16.92 for the industry. The stock is also trading below the stock’s 5-year mean of 11.27. The stock is much cheaper than other large drugmakers like Lilly, Novo Nordisk, AstraZeneca, J&J, Merck, AbbVie and others.
SNY Stock Valuation
The Zacks Consensus Estimate for 2026 earnings has risen from $4.97 per share to $4.98 per share over the past 60 days. For 2027, earnings estimates have risen from $5.18 per share to $5.21 per share over the same timeframe.
SNY Estimate Movement
Stay Invested in SNY Stock
Sanofi faces its share of headwinds, like generic erosion of key drug Aubagio in all key markets and lower sales from mature products, which are hurting sales. Other headwinds include heavy reliance on one blockbuster drug, Dupixent, competitive pressure on influenza vaccines, regular pipeline setbacks and regulatory and pricing pressure.
However, Sanofi’s Specialty Care unit is on a strong footing, particularly with the outstanding growth trajectory of Dupixent. It has increased R&D investments and is achieving significant progress with its pipeline. It has also been active on the M&A front. In 2025, it acquired Blueprint Medicines, which expanded its presence in rare immunological diseases and Vigil Neuroscience, which makes innovative TREM2-based therapeutics for neurodegenerative diseases.
In 2026, Sanofi expects sales to rise by a high single-digit percentage at CER. Sanofi expects earnings to grow faster than sales in 2026 at CER, before the impact of share repurchases.
Despite its recent share-price decline, an improving top-line performance, potential contributions from new product launches, a promising pipeline, and an attractive valuation are good enough reasons for those who own this Zacks Rank #3 (Hold) stock to stay invested.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).