Viking Therapeutics (VKTX), a player in the biopharmaceutical industry, is grabbing investors’ attention after its stock has surged up over 500% in the past year. It boasts a robust portfolio of treatments in various stages of development, with its leading drug, VK2735, showcasing impressive weight-loss results in Phase 2 trials for obesity. Other promising therapies include VK2809 for non-alcoholic steatohepatitis, VK5211 for hip fracture surgery recovery, VK0612 for type 2 diabetes, and VK0214 for X-linked adrenoleukodystrophy.
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Despite reporting a net loss in Q3 2024, the company still beat earnings expectations. With rising price targets and positive trial results, Viking Therapeutics’ financial outlook remains promising, making it an attractive option for investors in the biopharmaceutical sector.
Viking Therapeutics’ Promising Pipeline
Viking Therapeutics is a clinical-stage biopharmaceutical company primarily focusing on developing new treatments for metabolic and endocrine disorders. Its leading candidate is VK2809, an oral medication currently in Phase IIb clinical trials aimed at treating patients with biopsy-proven non-alcoholic steatohepatitis and NAFLD. Other drugs under development include VK5211, in Phase II trials for patients recovering from non-elective hip fracture surgery; VK0612, a Phase IIb-ready drug for type 2 diabetes; VK2735, a new dual agonist in Phase 2 clinical trials; and VK0214, another TRß agonist being developed for X-linked adrenoleukodystrophy.
Viking has recently reported positive outcomes from several clinical trials. The Phase 2 VENTURE trial showed notable weight reduction results from the application of subcutaneous VK2735, with encouraging results also recorded for an oral formulation of VK2735. The Phase 2b VOYAGE trial, which tested VK2809 on patients with NASH/MASH and fibrosis, reported a decrease in liver fat, an enhancement in NASH/MASH resolution rate, and fibrosis. Furthermore, a Phase 1b clinical trial on VK0214 for patients with X-linked adrenoleukodystrophy yielded positive outcomes, including reductions in very long-chain fatty acids and other lipids.
In response to the FDA’s feedback, Viking is set to move VK2735 into a Phase 3 program for obesity, with an End-of-Phase 2 meeting planned for the fourth quarter. Additionally, Viking plans to launch a Phase 2 study on the oral version of VK2735 for obesity, taking advantage of the potential of an oral tablet formulation.
With its current financial standing of $930 million in cash and equivalents, Viking is well-equipped to reach significant milestones in its clinical programs.
Viking Therapeutics’ Recent Financial Results
Viking has recently released its Q3 financial statement, reporting research and development expenses escalating to $22.8 million, up from $18.4 million in the same period last year. The uptick is attributed to increasing costs related to manufacturing the company’s drug candidates, stock-based compensations, salaries, benefits, and regulatory services. Meanwhile, the net loss was $24.9 million, or $0.22 per share (beating estimates by $0.03), marking an increase compared to a loss of $22.5 million, or $0.23 per share, in the same period last year.
As of the quarter’s end, the company held cash, cash equivalents, and short-term investments amounting to $930 million, a significant increase from $362 million as of December 31, 2023.
Is VKTX a Buy?
The stock has been on a dramatic, though volatile (beta 2.46) run, climbing 862% over the past three years. It trades in the upper half of its 52-week price range of $9.34 – $99.41, though price momentum has cooled, with the stock trading below the 20-day (68.15) and 50-day (65.12) moving averages.
Analysts following the company have been bullish on VKTX stock. For example, H.C. Wainwright analyst Joseph Pantginis recently reiterated a Buy rating on the shares, raising the price target from $90 to $102, noting VK2735 ongoing trials highlight sustained weight loss, and the recent oral data suggest it could be a top contender in the space.
Viking Therapeutics is rated a Strong Buy overall, based on the most recent recommendations from 11 analysts. The average price target for VKTX stock is $113.67, representing a potential upside of 75.88% from current levels.
Bottom Line on Viking Therapeutics
Viking Therapeutics has astounded investors with its stock performance over the past few years. With treatment candidates in the pipeline showing promising results in their respective trials, the company is fortified by a significant cash standing that bolsters its potential to hit significant clinical program milestones. VKTX is a compelling option for investors in the biopharmaceutical sector due to its impressive clinical outcomes and positive outlook.
