Viking Therapeutics drop may be partially ‘sell the news,’ says H.C. Wainwright

After Viking Therapeutics (VKTX) announced topline results from its Phase 2 trial of oral VK2735 for weight loss, H.C. Wainwright analyst Joseph Pantginis views the weight loss results as “encouraging” and the tolerability profile as “something that can be optimized.” The firm highlights a few contributing factors that it believes may be driving the initial negative reaction in the stock, including some “sell the news” component at play, as well as the evolving landscape for GLP-1 studies and some “misleading” cross-trial comparisons to Phase 3 data from Eli Lilly (LLY) and Novo Nordisk (NVO). The firm, which believes that VK2735 has demonstrated competitive efficacy at both mid and high doses and has a “clear opportunity to balance efficacy with tolerability,” reiterates a Buy rating and $102 price target on Viking shares.