If you’ve got a weight loss drug, then you’ve practically got a license to print money these days. And Viking Therapeutics (VKTX) may be next in line for licenses as its own drug is moving into late-stage trials faster than expected. As a result, investors sent Viking shares up over 36.5% in Thursday afternoon’s trading.
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The latest reports note that Viking managed to get its experimental weight-loss treatment to late-stage testing—which by itself is good news—but on a ramped-up timetable. That improves the odds that the treatment will not only work, but will work fairly soon, and allow it to claim a piece of the market for itself that’s not already held by another provider.
The treatment, known as VK2735, is proceeding right into phase three after a written opinion from the Food and Drug Administration (FDA) prompted such a move. That’s going to cut as much as a year off the development cycle. In addition, the product itself may have an edge over its competitors; VK2735 is a monthly injection, while most of the competitors in the market are weekly injections. This makes Viking’s drug more convenient and comfortable than the alternatives.
And just to top it all off, Viking has several other noteworthy drugs waiting in the wings, which could start it off on a path to substantial income. Its VK2809, for example, focuses on nonalcoholic steatohepatitis, or NASH. That’s a kind of fatty liver disease that has nothing to do with alcohol, and given that there are over three million such cases a year, the end result is a potential gold mine for Viking from a second front, and that could mean explosive growth.
Is Viking Therapeutics a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Strong Buy consensus rating on VKTX stock based on 10 Buys assigned in the past three months, as indicated by the graphic below. After a 370% rally in its share price over the past year, the average VKTX price target of $112.63 per share implies 69.83% upside potential.
