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BTIG maintains Buy on Viking Therapeutics stock

EditorAhmed Abdulazez Abdulkadir
Published 05/07/2024, 12:00
VKTX
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On Friday, BTIG reiterated its Buy rating on Viking Therapeutics (NASDAQ:VKTX), maintaining a $125.00 price target for the stock. The firm's positive stance comes despite the stock's approximately 43% retreat from its peak in March 2024, which was attributed to market reactions to competitor results in the obesity sector and investor focus on partnerships.

The analyst from BTIG highlighted the upcoming second half of 2024 as a period with favorable catalysts for Viking Therapeutics. Key events include the company's second-quarter earnings call scheduled for later this month, where updates on the clinical and regulatory path for subcutaneous VK2735 and the status of dose escalation for the oral form of the drug are expected.

Viking Therapeutics is also anticipated to present new clinical data at Obesity Week, taking place from November 3 to November 6. The data is expected to cover higher doses of the oral VK2735, potentially ranging from 80 to 100 milligrams, and provide insights into the pharmacokinetics of the subcutaneous form, which may support once-a-month dosing.

Additionally, BTIG expressed optimism about Viking's DACRA (amylin/calcitonin agonist) programs, which have shown promising early data and are projected to progress to an Investigational New Drug (IND) application next year.

The analyst concluded by reiterating confidence in the long-term potential of combining the company's DACRA programs with VK2735 to enhance efficacy beyond current GLP-1/amylin regimens, supporting the firm's $125 price target for Viking Therapeutics.

In other recent news, Viking Therapeutics has made significant strides in its drug development. The company's Phase 2b VOYAGE study of VK2809 reported promising results in treating patients with non-alcoholic steatohepatitis (NASH), with significant reductions in liver fat content and improvements in fibrosis. Viking's Phase 2 VENTURE study of VK2735, aimed at treating obesity, also met its primary and secondary endpoints, demonstrating significant reductions in body weight.

Morgan Stanley (NYSE:MS) recently initiated an Overweight rating on Viking Therapeutics, citing the potential growth based on the promising Phase 2 data for VK2735 and VK2809. The investment firm set a price target of $105 for Viking's stock. Meanwhile, H.C. Wainwright and Truist Securities maintained their Buy ratings on Viking, with price targets of $90 and $120 respectively.

The company also reported successful outcomes from a Phase 1 trial of an oral tablet formulation of VK2735 and plans to proceed with further development later this year. Additionally, Viking strengthened its financial position by completing a public stock offering, raising approximately $630 million.

InvestingPro Insights

As Viking Therapeutics (NASDAQ:VKTX) navigates through a pivotal year, real-time data and analysis from InvestingPro provide a nuanced view of the company's financial health and market performance. With a market capitalization of $5.57 billion, the company is trading at a high Price / Book multiple of 5.96, reflecting investor sentiment on its assets' value despite the absence of current profitability. The negative P/E ratios, both standard (-54.23) and adjusted for the last twelve months as of Q1 2024 (-59.38), underscore the challenges Viking faces in achieving profitability.

InvestingPro Tips indicate that Viking Therapeutics holds more cash than debt, a sign of financial stability, and that its liquid assets exceed short-term obligations, suggesting a strong liquidity position. However, analysts have revised their earnings expectations downwards for the upcoming period, and the company is not expected to be profitable this year. Despite a significant price uptick over the last six months, with a six-month price total return of 177.46%, the recent performance has been more turbulent, with a one-month price total return of -14.28%.

For investors seeking a deeper dive into Viking Therapeutics' potential, there are additional insights available on InvestingPro's platform. With the use of the coupon code PRONEWS24, users can get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription, gaining access to a total of 12 additional InvestingPro Tips that could further inform investment decisions.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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