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Ligand Pharma
(NASDAQ:LGND)
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Rating:73Outperform
Price Target:
$327.00
▲(8.81% Upside)
Action:Reiterated
Date:08/08/26
The score is driven primarily by strong current fundamentals (high profitability and healthy cash generation) and a constructive earnings-call outlook (raised EPS guidance and accretive XOMA acquisition with strong cash-flow expectations). Offsetting factors include increased balance-sheet leverage, a relatively expensive valuation (P/E ~36.7), and only neutral-to-mild technical momentum in the near term.
Positive Factors
Royalty/licensing model with high margins
Ligand's partner-centric royalty and licensing model produces recurring, high-margin cash flows and operating leverage. Durable royalty receipts reduce commercial execution risk, supporting sustained profitability and cash generation that can fund acquisitions and shareholder returns over multiple years.
Negative Factors
Elevated balance-sheet leverage
Debt exceeding equity raises financing and covenant risk, reducing flexibility if royalties or milestone timing underperform. Higher leverage increases interest and redemption obligations on convertibles and can constrain future M&A or share-repurchase optionality if earnings normalize lower.
Read all positive and negative factors
Positive Factors
Negative Factors
Royalty/licensing model with high margins
Ligand's partner-centric royalty and licensing model produces recurring, high-margin cash flows and operating leverage. Durable royalty receipts reduce commercial execution risk, supporting sustained profitability and cash generation that can fund acquisitions and shareholder returns over multiple years.
Read all positive factors
Ligand Pharma (LGND) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$5.76B
Dividend YieldN/A
Average Volume (3M)481.09K
Price to Earnings (P/E)29.4
Beta (1Y)0.88
Revenue Growth54.89%
EPS GrowthN/A
CountryUS
Employees47
SectorHealthcare
Sector Strength45
IndustryBiotechnology
Share Statistics
EPS (TTM)10.01
Shares Outstanding19,935,610
10 Day Avg. Volume310,228
30 Day Avg. Volume481,093
Financial Highlights & Ratios
PEG Ratio>-0.01
Price to Book (P/B)3.59
Price to Sales (P/S)13.64
P/FCF Ratio74.76
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$350.86Price Target Upside16.75% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering8
EPS Forecast (FY)9.26
Revenue Forecast (FY)$290.22M
Ligand Pharma Business Overview & Revenue Model
Company Description
Ligand Pharmaceuticals Incorporated operates as a biopharmaceutical entity, primarily engaged in sourcing and advancing technologies to empower pharmaceutical companies globally in their efforts to discover and develop novel therapeutic solutions....
How the Company Makes Money
Ligand primarily makes money by licensing its drug candidates and technologies to third-party partners and then earning payments tied to those partners’ progress and sales. Key revenue streams generally include: (1) Royalties: recurring royalties ...
Ligand Pharma Earnings Call Summary
Earnings Call Date:Aug 06, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 05, 2026
Earnings Call Sentiment Positive
The call communicated strong operational and financial momentum: robust top-line and EPS growth, significant cash flow generation, completion of an accretive and scalable acquisition (XOMA), and successful low-cost financing that materially strengthens capital flexibility. Manageable near-term challenges include a product sales decline (Kyprolis), one-time charges, accounting complexity from increased financial royalty assets, and some timing risk from an FDA recommendation requiring a Phase III for PSC. On balance, the company presented multiple clear growth drivers and disciplined capital deployment that outweigh the identified risks.Positive Updates
Strong Top-Line Growth
Total revenue of $64M in Q2 2026, up 34% year-over-year; royalty revenue of $48M, up 32% year-over-year driven by Filspari, Ohtuvayre and Zelsuvmi.
Negative Updates
Decline in Kyprolis Sales
Amgen's reported Kyprolis net sales of $314M in the quarter, down 17% year-over-year due to lower volume; company notes decline was anticipated and remains within royalty guidance.
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Top-Line Growth
Total revenue of $64M in Q2 2026, up 34% year-over-year; royalty revenue of $48M, up 32% year-over-year driven by Filspari, Ohtuvayre and Zelsuvmi.
Read all positive updates
Company Guidance
Ligand updated 2026 guidance, raising the low end of adjusted diluted EPS to $9 while keeping the high end at $9.50; reaffirming royalty revenue of $225–$250M, total revenue $270–$310M, Captisol revenue $35–$40M (remaining Captisol sales weighted ~40% Q3 / 60% Q4) and contract revenue $10–$20M (majority of remaining contract revenue expected in Q4). Management said the XOMA acquisition is immediately accretive and should contribute ~ $0.50 to adjusted EPS in H2 2026 and ~ $1.50 in 2027, adds >120 assets (≈7 commercial, ~14 late‑stage, >100 clinical/preclinical), ~$2.3B of disclosed milestone upside and >$110M of Section 174 tax credits/NOLs, and will cut XOMA OpEx from ~ $30M to < $5M. After completing a $700M 0%‑coupon convertible offering and repurchasing ~229,000 shares for ~$60M, the company has ~ $700M of deployable capital, expects operating cash flow > $200M in 2026 (rising toward ~$300M in 2027), and cited Q2 results of $64M total revenue (+34% YoY), $48M royalty revenue (+32%) and adjusted EPS $2.37 (+48%).Ligand Pharma Financial Statement Overview
Summary
Income Statement
82
Very Positive
Balance Sheet
58
Neutral
Cash Flow
74
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 290.54M | 268.09M | 167.13M | 131.31M | 196.25M | 241.54M |
| Gross Profit | 286.42M | 261.50M | 156.06M | 96.27M | 143.42M | 179.37M |
| EBITDA | 273.74M | 192.74M | 40.79M | 100.84M | 81.20M | 142.77M |
| Net Income | 197.22M | 124.45M | -4.03M | 52.15M | -33.36M | 57.14M |
Balance Sheet | ||||||
| Total Assets | 2.19B | 1.56B | 941.77M | 787.22M | 762.67M | 1.30B |
| Cash, Cash Equivalents and Short-Term Investments | 1.36B | 733.52M | 256.17M | 170.31M | 211.87M | 341.11M |
| Total Debt | 1.13B | 451.49M | 7.11M | 6.17M | 87.75M | 324.39M |
| Total Liabilities | 1.22B | 543.42M | 111.33M | 86.30M | 165.18M | 476.43M |
| Stockholders Equity | 967.52M | 1.02B | 830.44M | 700.91M | 597.49M | 821.16M |
Cash Flow | ||||||
| Free Cash Flow | 131.37M | 48.91M | 77.41M | -4.27M | 119.93M | 70.04M |
| Operating Cash Flow | 131.64M | 49.36M | 97.05M | 49.58M | 137.85M | 78.80M |
| Investing Cash Flow | -144.78M | -377.32M | -143.66M | -11.68M | 163.62M | 30.52M |
| Financing Cash Flow | 950.28M | 428.22M | 97.14M | -59.95M | -275.99M | -137.76M |
Ligand Pharma Technical Analysis
Positive
300.53
Price Trends
289.37
Positive
254.60
Positive
225.75
Positive
Market Momentum
0.19
Positive
50.45
Neutral
24.06
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 300.53 is above the 20-day moving average (MA) of 296.09, above the 50-day MA of 289.37, and above the 200-day MA of 225.75, indicating a neutral trend. The MACD of 0.19 indicates Positive momentum. The RSI at 50.45 is Neutral, neither overbought nor oversold. The STOCH value of 24.06 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LGND.
Ligand Pharma Risk Analysis
Ligand Pharma disclosed 65 risk factors in its most recent earnings report. Ligand Pharma reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Ligand Pharma Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $5.76B | 29.43 | 20.06% | ― | 54.89% | ― | |
59 Neutral | $8.96B | -16.77 | -44.22% | ― | 2928.45% | -22.68% | |
59 Neutral | $9.51B | -36.12 | -21.50% | ― | 134.84% | 6.73% | |
54 Neutral | $1.40B | -4.28 | -82.68% | ― | ― | -37.48% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
51 Neutral | $6.46B | -15.87 | -160.19% | ― | ― | -14.40% |
* Healthcare Sector Average
LGND
Ligand Pharma
294.60
143.52
94.99%
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Ligand Pharma Corporate Events
Business Operations and StrategyDelistings and Listing ChangesFinancial DisclosuresLegal ProceedingsM&A Transactions
Ligand Pharma completes transformative XOMA royalty acquisition
Positive
Jul 15, 2026
On July 14, 2026, Ligand Pharmaceuticals completed its acquisition of XOMA Royalty Corporation for $39 per share in cash, valuing the deal at about $739 million and removing XOMA Royalty’s stock from Nasdaq trading. XOMA shareholders also re...
Business Operations and StrategyStock BuybackPrivate Placements and Financing
Ligand Pharma Completes Major Convertible Notes Financing Transaction
Positive
Jun 25, 2026
On June 25, 2026, Ligand Pharmaceuticals closed a previously announced $700 million private offering of 0.00% convertible senior notes due 2031, including the full exercise of a $75 million overallotment option, issuing senior unsecured securities...
Business Operations and StrategyStock BuybackPrivate Placements and Financing
Ligand Pharma Plans $550 Million Convertible Notes Offering
Positive
Jun 22, 2026
On June 22, 2026, Ligand Pharmaceuticals amended its existing credit agreement to allow the issuance of new convertible senior notes and to reset minimum consolidated EBITDA covenants to $100 million through the quarter ending March 31, 2027, and ...
Business Operations and StrategyExecutive/Board ChangesShareholder Meetings
Ligand Pharma Shareholders Back Governance and Incentive Plan
Positive
Jun 9, 2026
At its annual stockholders’ meeting held on June 5, 2026, Ligand Pharmaceuticals’ investors approved an amendment and restatement of the company’s 2002 Stock Incentive Plan, signaling continued use of equity-based compensation to...
Business Operations and StrategyM&A TransactionsRegulatory Filings and ComplianceShareholder Meetings
Ligand Pharma Advances XOMA Royalty Acquisition with Amendment
Neutral
May 18, 2026
On April 27, 2026, Ligand Pharmaceuticals entered into a merger agreement under which its wholly owned subsidiary Flex Merger Sub will merge with XOMA Royalty’s newly formed Nevada entity, XOMA Royalty Holdings Corporation, which will surviv...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.