Ligand Pharma (LGND) AI Stock Analysis

• Market Cap: $3.31B
• Dividend Yield: N/A
• Average Volume (3M): 215.45K
• Price to Earnings (P/E): 48.0
• Beta (1Y): 1.09
• Revenue Growth: 40.54%
• EPS Growth: -264.26%
• Country: US
• Employees: 68
• Sector: Healthcare
• Sector Strength: 45
• Industry: Biotechnology
• EPS (TTM): 1.60
• Shares Outstanding: 19,596,560
• 10 Day Avg. Volume: 302,794
• 30 Day Avg. Volume: 215,452
• PEG Ratio: 4.53
• Price to Book (P/B): 2.36
• Price to Sales (P/S): 11.73
• P/FCF Ratio: 20.58
• Enterprise Value/Market Cap: 0.61
• Enterprise Value/Revenue: 11.16
• Enterprise Value/Gross Profit: 13.49
• Enterprise Value/Ebitda: -16.59
• 1Y Price Target: $182.20
• Price Target Upside: 7.35% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 6

• Rating: 67 Neutral
• Price Target: $166.00 ▼(-2.19% Downside)

Ligand Pharma's strong earnings call performance and technical analysis indicators are the most significant factors driving the stock score. The company's strategic investments and increased financial guidance highlight its growth potential. However, financial performance and valuation concerns, such as declining revenue and a negative P/E ratio, present risks that temper the overall score.

Positive Factors

Revenue Growth

The significant growth in royalty revenue indicates strong demand for Ligand's licensed technologies, supporting sustained revenue streams and enhancing long-term financial stability.

Strategic Partnerships

These strategic partnerships with major medical device companies enhance Ligand's market position and potential for innovation, contributing to long-term growth prospects.

Product Launch Success

The successful launch of Zelsuvmi and its expected sales highlight Ligand's capability to bring new products to market, driving future revenue and market expansion.

Negative Factors

Declining Revenue Trend

A declining revenue trend poses a risk to Ligand's financial performance, potentially impacting its ability to invest in growth initiatives and maintain competitive positioning.

Increased Operating Expenses

Rising operating expenses can pressure profit margins and reduce financial flexibility, challenging Ligand's ability to sustain profitability and invest in future growth.

Volatile Free Cash Flow

Volatility in free cash flow can hinder Ligand's ability to fund operations and strategic initiatives, affecting its long-term financial health and growth potential.

Ligand Pharma Business Overview & Revenue Model

Company Description

Ligand Pharmaceuticals Incorporated, a biopharmaceutical company, focuses on developing or acquiring technologies that help pharmaceutical companies to discover and develop medicines worldwide. Its commercial programs include Kyprolis and Evomela, which are used to treat multiple myeloma; Veklury for the treatment of moderate or severe COVID-19; Teriparatide injection product for osteoporosis; Vaxneuvance for the prevention of invasive disease caused by Streptococcus pneumoniae; and Pneumosil, a pneumococcal conjugate vaccine to help fight against pneumococcal pneumonia among children. The company also offers Rylaze, a recombinant erwinia asparaginase for the treatment of acute lymphoblastic leukemia or lymphoblastic lymphoma in adult and pediatric patients; and Nexterone, a captisol-enabled formulation of amiodarone; and Zulresso, a captisol-enabled formulation of brexanolone for the treatment of postpartum depression. In addition, it provides Noxafil-IV, a captisol-enabled formulation of posaconazole for IV use; Duavee for the treatment of postmenopausal osteoporosis; Aziyo portfolio of commercial pericardial repair and CanGaroo envelope extracellular matrix products; Exemptia for autoimmune diseases; Vivitra for breast cancer; Bryxta and Zybev for various indications; and Minnebro for the treatment of hypertension. The company's partners and licenses programs, which are in clinical development used for the treatment of cancer, seizure, diabetes, cardiovascular disease, muscle wasting, liver and kidney disease, and other diseases. Further, it sells Captisol materials. The company was incorporated in 1987 and is headquartered in Emeryville, California.

How the Company Makes Money

Ligand Pharmaceuticals generates revenue through several key streams, primarily focusing on licensing agreements and partnerships with other pharmaceutical companies. The company licenses its technologies and product candidates to partners, receiving upfront payments, milestone payments as development progresses, and royalties on any commercialized products. Significant partnerships with major pharmaceutical companies enhance Ligand’s earning potential, as these collaborations often involve large-scale drug development projects. Additionally, Ligand may receive funds from research and development services provided to partners. The recurring nature of royalty payments from successfully marketed drugs, combined with milestone payments from ongoing collaborations, forms the backbone of Ligand's revenue model.

Ligand Pharma Financial Statement Overview

Summary

Ligand Pharma shows a mixed financial picture with declining revenue and profitability, yet maintains a strong equity position. While cash flows are generally positive, volatility in free cash flow and revenue trends pose risks. Financial stability is supported by low leverage, but improving operational efficiency remains crucial.

Income Statement

The company's income statement shows a declining revenue trend with significant fluctuations in profitability. Gross profit margin is relatively high, but EBIT and net profit margins are negative, indicating operational challenges. Revenue has decreased significantly in recent periods, affecting overall financial performance.

Balance Sheet

The balance sheet reveals a strong equity position with a low debt-to-equity ratio, suggesting financial stability. However, total assets have been decreasing, and liabilities are relatively high compared to assets. Return on equity has been inconsistent, indicating fluctuating profitability.

Cash Flow

The company's cash flow statement indicates adequate operating cash flow; however, free cash flow has been volatile, with a significant decline recently. The operating cash flow to net income ratio is favorable, but fluctuations in free cash flow present challenges.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	181.49M	167.13M	131.31M	196.25M	277.13M	186.42M
Gross Profit	150.14M	156.06M	96.27M	143.42M	214.96M	156.00M
EBITDA	-122.11M	40.79M	100.84M	54.41M	133.16M	69.05M
Net Income	-132.62M	-4.03M	52.15M	-5.22M	57.14M	-2.98M
Balance Sheet
Total Assets	905.43M	941.77M	787.22M	762.67M	1.30B	1.36B
Cash, Cash Equivalents and Short-Term Investments	208.90M	256.17M	170.31M	211.87M	341.11M	411.19M
Total Debt	4.45M	7.11M	6.17M	87.75M	336.26M	454.53M
Total Liabilities	109.90M	111.33M	86.30M	165.18M	479.75M	652.76M
Stockholders Equity	795.53M	830.44M	700.91M	597.49M	821.63M	709.52M
Cash Flow
Free Cash Flow	35.51M	95.23M	-4.27M	119.93M	70.04M	50.13M
Operating Cash Flow	52.81M	97.05M	49.58M	137.85M	78.80M	54.59M
Investing Cash Flow	-135.00M	-143.66M	-11.68M	163.62M	30.52M	231.65M
Financing Cash Flow	80.27M	97.57M	-59.95M	-275.99M	-137.76M	-310.55M

Ligand Pharma Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 169.72
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LGND, the sentiment is Positive. The current price of 169.72 is above the 20-day moving average (MA) of 166.84, above the 50-day MA of 154.14, and above the 200-day MA of 122.06, indicating a bullish trend. The MACD of 4.28 indicates Positive momentum. The RSI at 63.32 is Neutral, neither overbought nor oversold. The STOCH value of 61.48 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LGND.

Ligand Pharma Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
LGND	67 Neutral	$3.31B	48.01	-9.46%	―	40.54%	-264.26%
KYMR	57 Neutral	3.75B	-15.46	-28.35%	―	-49.51%	-44.09%
CRNX	52 Neutral	3.31B	-8.73	-22.52%	―	―	-9.10%
SRRK	50 Neutral	3.24B	-11.43	―	―	―	-29.50%
APLS	47 Neutral	2.87B	-12.18	-86.58%	―	20.02%	33.45%
MLTX	41 Neutral	3.46B	-20.21	―	―	―	-208.46%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%

Ligand Pharma Corporate Events

Ligand Pharma Completes $460M Convertible Notes Offering

On August 14, 2025, Ligand Pharmaceuticals completed a private offering of $460 million in convertible senior notes due 2030, including an additional $60 million purchased by initial buyers. The notes, which are unsecured and bear a 0.75% interest rate, are part of Ligand’s strategy to manage potential stock dilution and fund corporate purposes, including stock repurchases and convertible note hedge transactions. These financial maneuvers are expected to impact Ligand’s stock market activity and provide flexibility in managing its capital structure.

Ligand Pharma Announces $400M Convertible Notes Offering

On August 11, 2025, Ligand Pharmaceuticals announced a proposed offering of $400 million in convertible senior notes due 2030, aimed at qualified institutional buyers. This financial move is expected to support Ligand’s strategic initiatives, including potential repurchases of its common stock and investments in complementary businesses, which could influence the market dynamics of its stock and overall financial positioning.

Ligand Pharma Completes Merger Forming Pelthos Therapeutics

On July 2, 2025, Ligand Pharmaceuticals completed a merger between its subsidiary LNHC, Inc. and Channel Therapeutics Corporation’s subsidiary, resulting in the formation of Pelthos Therapeutics Inc. Pelthos will trade on the NYSE American exchange under the ticker symbol ‘PTHS’ and plans to launch ZELSUVMI, a novel treatment for Molluscum contagiosum infections. Ligand invested $18 million in Pelthos and will receive a 13% royalty on worldwide sales of ZELSUVMI. The merger is seen as a transformative milestone, unlocking potential for innovation and long-term value for shareholders. Pelthos also raised $50.1 million in equity capital to support the commercial launch of ZELSUVMI and other development programs.

Ligand Pharma Elects Board Members at Annual Meeting

On June 6, 2025, Ligand Pharmaceuticals held its Annual Meeting of Stockholders where eight board members were elected for terms expiring in 2026. Additionally, the selection of Ernst & Young LLP as the company’s independent registered public accounting firm for 2025 was ratified, and a non-binding advisory resolution on executive compensation was approved.