Krystal Biotech falls 11.0% after mixed third-quarter results

What happened

Krystal Biotech (KRYS) fell 11.0% on November 2, 2026, after reporting third-quarter results that paired strong commercial revenue with a year-over-year decline in GAAP earnings. The stock closed at $295.90 after it opened 5.4% below the previous close and trading volume was 4.5 times its 20-day average. Krystal reported continued VYJUVEK commercial growth, with $127.3 million in 3Q VYJUVEK global revenue and $1.1 billion in cumulative VYJUVEK revenue since launch, and said VYJUVEK pricing negotiations in Germany and Italy are complete, according to GlobeNewsWire and Seeking Alpha.

How big was the move

The decline was large relative to the stock’s usual intraday swings: the session was 4.5 times a typical daily move for this stock. The stock underperformed the Healthcare sector on the day by 9.3 percentage points; the Healthcare sector median fell 1.6% while the S&P 500 fell 0.5%. Over the prior five sessions the stock had fallen 5.7%, versus a 1.8% decline in the S&P 500 over the same span. The heavy trading suggests investors were actively repositioning around the earnings news.

The technical picture

Technically, the stock sits below short- and medium-term averages: it is 8.2% below its 20-day moving average and 12.1% below its 50-day moving average, though the 50-day average is above the 200-day average, a sign of an established uptrend. The stock is 4.1% below its 200-day average and 22.6% below the 52-week high. Momentum indicators are neutral: the Relative Strength Index (14 days) is 35, between 30 and 70. Over one month the shares fell 8.2% and over three months they fell 8.9%, while over one year the stock rose 56.5%, 46.0 percentage points ahead of the S&P 500. Volatility is moderate at 39% annualized over 60 days, lower than 79% of its own readings over five years.

Fundamentals and valuation

For the four quarters through September 30, 2026, Krystal Biotech reported revenue of $470.0 million, which grew 26.0% from a year earlier and accelerated from growth of 22.6% one quarter earlier. Diluted earnings per share were $7.37, which rose 10.5% from a year earlier. Gross margin stood at 93.4% (a year earlier: 93.9%) and operating margin was 48.4% (a year earlier: 42.4%), while free-cash-flow margin was 66.0% and return on invested capital was 14.4%. The balance sheet showed net cash of $454.3 million and share count over one year increased by 3.4%.

Valuation metrics are elevated but roughly in line with recent history. The stock trades at 40.1 times trailing earnings and 40.4 times expected forward earnings, readings that are lower than 58% of its own readings over the past five years (five-year median: 41.1 times earnings). Free-cash-flow yield is 3.2%. PromtFinance scores rate Growth at 86 (Strong) and Quality at 96 (Exceptional), with Revisions at 92 (Exceptional) and Stability at 95 (Exceptional), while Value is 66 (Positive). Those scores underscore the company’s strong operational performance despite a high multiple.

Earnings and analyst expectations

Krystal released third-quarter results on November 2, 2026, reporting GAAP earnings of $2.05 per share for the quarter versus $2.66 a year ago and above the Zacks Consensus Estimate of $1.84. The quarterly headline beat showed earnings per share of $2.05 against $1.79 expected, 14.5% above estimates, and marked the sixth consecutive quarter beating estimates. The company said it ended the quarter with $1.2 billion in cash and investments and announced a board-authorized share repurchase program of up to $400 million.

Analyst coverage is uniformly positive: 100% of the 17 analysts with a rating rate the stock Buy or Strong Buy, and the consensus price target is $395.20, 33.6% above the closing price. The company’s average earnings surprise over the last four reports is 12.7% above estimates, and the typical two-day reaction after recent reports has been a fall of 2.9%. That historical pattern suggests the sharp single-day drop this session exceeded the reaction investors commonly show to Krystal’s beats.

What to watch

• Next report: February 16, 2027
• Last report: November 2, 2026: earnings per share of $2.05 against $1.79 expected, 14.5% above estimates
• Board-authorized share repurchase program: up to $400 million
• Q3 VYJUVEK global revenue: $127.3 million and $1.1 billion cumulative revenue since launch
• Net cash on the balance sheet: $454.3 million