Zai Lab Ltd (9688) AI Stock Analysis

• Market Cap: HK$34.34B
• Dividend Yield: N/A
• Average Volume (3M): 16.42M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.27
• Revenue Growth: 43.13%
• EPS Growth: 28.93%
• Country: HK
• Employees: 1,869
• Sector: Healthcare
• Sector Strength: 37
• Industry: Biotechnology
• EPS (TTM): -0.29
• Shares Outstanding: 1,110,783,700
• 10 Day Avg. Volume: 20,094,508
• 30 Day Avg. Volume: 16,421,753
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: HK$31.02
• Price Target Upside: 0.12% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 49 Neutral
• Price Target: HK$29.00 ▼(-6.39% Downside)

The stock of Zai Lab Ltd scores moderately due to strong revenue growth and technical indicators suggesting positive market momentum. However, significant profitability challenges and a negative valuation due to ongoing losses weigh down the overall score. The absence of dividend yield further impacts its valuation attractiveness.

Zai Lab Ltd Business Overview & Revenue Model

Company Description

Zai Lab Ltd (9688) is a prominent biopharmaceutical company focused on the development and commercialization of therapies for oncology, autoimmune and infectious diseases. The company leverages its strong research and development capabilities to bring innovative medicines to patients in China and other global markets. Zai Lab collaborates with leading international pharmaceutical companies to enhance its portfolio and deliver cutting-edge treatments.

How the Company Makes Money

Zai Lab Ltd primarily generates revenue through the commercialization and sales of its pharmaceutical products. The company has a diverse revenue model that includes direct sales of approved therapies, milestone payments, and royalties from strategic partnerships and licensing agreements with global pharmaceutical companies. These partnerships often involve co-development and co-commercialization of drug candidates, which provide Zai Lab with upfront payments and a share of future sales. Additionally, Zai Lab invests in its pipeline of drug candidates, which, upon successful approval and market entry, contribute significantly to its revenue streams. The company's earnings are also influenced by its ability to expand market access and grow its presence in the rapidly evolving Chinese healthcare sector.

Zai Lab Ltd Financial Statement Overview

Summary

Zai Lab Ltd is experiencing robust revenue growth; however, profitability remains a significant challenge due to high operating expenses. The balance sheet shows strong equity and manageable debt levels, ensuring financial stability, but ongoing losses impact return metrics. Cash flow management is improving but still needs enhancement for sustainable growth.

Income Statement

The company's revenue has shown a consistent upward trend over the years, with TTM revenue increasing by 4.9% compared to the previous year. However, the company is still facing significant net losses, and the net profit margin remains negative at -60.26% in TTM. The gross profit margin is relatively strong at 63.44%, but high operating expenses are impacting profitability, as seen in the negative EBIT and EBITDA margins of -64.08% and -56.52%, respectively.

Balance Sheet

The company maintains a strong equity position with an equity ratio of 69.05% in TTM, indicating financial stability. The debt-to-equity ratio is relatively low at 0.24, suggesting prudent leverage management. However, the return on equity is negative at -31.10%, reflecting ongoing profitability challenges despite a solid capital structure.

Cash Flow

Cash flows show improvement, with a reduction in negative free cash flow growth rate from the previous year, although it remains negative at -13.56% in TTM. The operating cash flow to net income ratio is positive, suggesting some alignment between cash generation and accounting profits. However, the free cash flow to net income ratio remains negative, highlighting the need for cash management improvements.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	398.99M	266.72M	215.04M	144.31M	48.96M
Gross Profit	251.13M	170.90M	141.02M	92.07M	32.22M
EBITDA	-242.99M	-365.11M	-384.66M	-689.46M	-262.96M
Net Income	-257.10M	-334.62M	-481.99M	-692.44M	-298.16M
Balance Sheet
Total Assets	1.19B	1.04B	1.22B	1.61B	1.30B
Cash, Cash Equivalents and Short-Term Investments	779.67M	806.45M	1.01B	1.41B	1.19B
Total Debt	153.47M	15.15M	20.39M	15.54M	18.60M
Total Liabilities	344.86M	240.18M	174.54M	230.00M	128.29M
Stockholders Equity	840.90M	796.12M	1.05B	1.38B	1.17B
Cash Flow
Free Cash Flow	-276.39M	-206.67M	-392.63M	-568.18M	-226.72M
Operating Cash Flow	-214.87M	-198.18M	-367.64M	-549.23M	-216.06M
Investing Cash Flow	-375.19M	-10.78M	420.02M	249.96M	-554.83M
Financing Cash Flow	349.89M	-6.43M	-1.73M	820.20M	1.13B

Zai Lab Ltd Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 30.98
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:9688, the sentiment is Positive. The current price of 30.98 is above the 20-day moving average (MA) of 28.78, above the 50-day MA of 28.50, and above the 200-day MA of 24.66, indicating a bullish trend. The MACD of 0.61 indicates Negative momentum. The RSI at 58.24 is Neutral, neither overbought nor oversold. The STOCH value of 45.58 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:9688.

Zai Lab Ltd Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2696	70 Outperform	HK$40.46B	44.81	31.65%	―	4.23%	47.71%
9966	65 Neutral	HK$9.49B	48.45	9.52%	―	185.36%	―
2157	57 Neutral	HK$17.75B	―	-51.40%	―	58.75%	-1310.16%
Sector *	57 Neutral	£5.20B	5.71	-64.94%	2.22%	32.39%	-7.18%
1877	54 Neutral	HK$41.38B	―	-19.78%	―	25.96%	39.58%
9688	49 Neutral	HK$34.34B	―	-29.51%	―	43.13%	28.93%
9995	47 Neutral	HK$37.58B	―	-56.68%	―	52.25%	11.46%

Zai Lab Ltd Corporate Events

Zai Lab to Announce 2025 Interim Results on August 7

Zai Lab Limited has announced that its Audit Committee will review and approve the unaudited interim results for the first half of 2025 on August 7, 2025. The results, prepared in accordance with U.S. GAAP and SEC rules, will be published on the same day. Following the announcement, the company will host a live earnings teleconference and webcast to discuss the results. This announcement signifies Zai Lab’s commitment to transparency and adherence to regulatory standards, potentially impacting its market position and stakeholder confidence.

The most recent analyst rating on (HK:9688) stock is a Buy with a HK$24.34 price target. To see the full list of analyst forecasts on Zai Lab Ltd stock, see the HK:9688 Stock Forecast page.

Zai Lab Ltd Announces Equity Incentive Grants to Align Employee Interests

Zai Lab Ltd has announced the grant of share options, restricted share units, and performance share units under its 2024 Equity Incentive Plan. This move, which includes significant allocations to key personnel such as Dr. Samantha Du, aims to align the interests of employees with the company’s growth objectives and maintain competitive compensation practices. The grants are structured without performance targets or clawback mechanisms, reflecting the company’s customary practices and market competitiveness.

The most recent analyst rating on (HK:9688) stock is a Buy with a HK$24.34 price target. To see the full list of analyst forecasts on Zai Lab Ltd stock, see the HK:9688 Stock Forecast page.

Zai Lab Limited Announces Relocation of PRC Headquarters

Zai Lab Limited has announced a change in its head office and principal place of business in the People’s Republic of China. Effective July 1, 2025, the company’s new location will be in Pudong, Shanghai. This move may indicate strategic positioning within the region, potentially impacting its operational efficiency and market presence in China.

The most recent analyst rating on (HK:9688) stock is a Buy with a HK$24.34 price target. To see the full list of analyst forecasts on Zai Lab Ltd stock, see the HK:9688 Stock Forecast page.

Zai Lab Limited Announces Key Management Changes

Zai Lab Limited announced the resignation of Ms. Nelly Au-Yeung as joint company secretary and authorized representative, effective June 27, 2025. Mr. Frazor Titus Edmondson III will assume the role of sole company secretary and authorized representative, ensuring continuity in corporate governance. The board expressed gratitude to Ms. Au-Yeung for her contributions.

The most recent analyst rating on (HK:9688) stock is a Buy with a HK$24.34 price target. To see the full list of analyst forecasts on Zai Lab Ltd stock, see the HK:9688 Stock Forecast page.

Zai Lab Ltd Grants Share Options and Units Under 2024 Equity Plan

Zai Lab Ltd announced the granting of share options and restricted share units under its 2024 Equity Incentive Plan. On June 3, 2025, the company granted options to subscribe for 2,500 American Depositary Shares (ADSs) to one employee and restricted share units covering 4,104 ADSs to three employees. This move is part of Zai Lab’s strategy to align employee incentives with company performance, although the grants do not include performance targets or clawback mechanisms. The compensation committee believes this approach is market competitive and consistent with the company’s customary practices.

The most recent analyst rating on (HK:9688) stock is a Buy with a HK$24.34 price target. To see the full list of analyst forecasts on Zai Lab Ltd stock, see the HK:9688 Stock Forecast page.

Zai Lab Ltd Grants Restricted Share Units to Employees

Zai Lab Ltd announced the grant of 9,800 Restricted Share Units to two employees under its 2024 Equity Incentive Plan. This initiative aims to recognize and reward the employees’ contributions and incentivize their continued efforts towards the company’s success. The grants, which have no performance targets or clawback mechanisms, are seen as market competitive and aligned with the company’s practices, potentially enhancing employee retention and motivation.

The most recent analyst rating on (HK:9688) stock is a Buy with a HK$24.34 price target. To see the full list of analyst forecasts on Zai Lab Ltd stock, see the HK:9688 Stock Forecast page.

Zai Lab Reports Strong Q1 2025 Results and Promising Oncology Advances

Zai Lab Limited reported a 22% year-over-year increase in total revenues for the first quarter of 2025, reaching $106.5 million, and is on track to achieve profitability by the fourth quarter of 2025. The company is advancing its oncology pipeline with promising data presentations and is poised for growth with a strong cash position and expanding global portfolio, aiming to drive long-term shareholder value.

Zai Lab Limited Files Q1 2025 Form 10-Q with SEC

Zai Lab Limited announced the filing of its Quarterly Report on Form 10-Q for the quarter ended March 31, 2025, with the U.S. Securities and Exchange Commission. This filing is part of the company’s regulatory compliance and provides stakeholders with updated financial and operational information, potentially impacting its market positioning and investor relations.