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Ligand Pharma
(NASDAQ:LGND)
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Rating:77Outperform
Price Target:
$323.00
▲(39.33% Upside)
Action:Reiterated
Date:06/26/26
The score is driven primarily by strong TTM financial performance (high profitability, rapid growth, and solid cash generation) and a constructive earnings outlook tied to the expected XOMA close and guidance. This is tempered by overbought technical conditions, a relatively high P/E valuation with no dividend support, and event-related risks including convertible-related dilution overhang and the Viking license dispute.
Positive Factors
Strong cash generation
Consistent, high trailing‑twelve‑month operating and free cash flow that nearly matches net income indicates durable cash conversion and high earnings quality. This provides recurring internal funding for royalty purchases, milestone support, and buybacks, reducing reliance on dilutive financing over the medium term.
Negative Factors
Partner execution dependence
Revenue and cashflow are structurally tied to third‑party development, regulatory and commercial timing. Successful royalties require partner execution, approvals and reimbursement — factors outside Ligand’s control — producing persistent timing risk and lumpy recognition that can materially swing results across quarters and years.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong cash generation
Consistent, high trailing‑twelve‑month operating and free cash flow that nearly matches net income indicates durable cash conversion and high earnings quality. This provides recurring internal funding for royalty purchases, milestone support, and buybacks, reducing reliance on dilutive financing over the medium term.
Read all positive factors
Ligand Pharma (LGND) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$6.08B
Dividend YieldN/A
Average Volume (3M)233.52K
Price to Earnings (P/E)40.1
Beta (1Y)0.89
Revenue Growth51.24%
EPS GrowthN/A
CountryUS
Employees68
SectorHealthcare
Sector Strength45
IndustryBiotechnology
Share Statistics
EPS (TTM)7.84
Shares Outstanding20,041,061
10 Day Avg. Volume267,372
30 Day Avg. Volume233,523
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 Cap0.92
Enterprise Value/Revenue20.44
Enterprise Value/Gross Profit20.73
Enterprise Value/Ebitda25.25
Forecast
1Y Price Target
$280.67Price Target Upside21.07% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering6
EPS Forecast (FY)9.06
Revenue Forecast (FY)$286.95M
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:May 07, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 11, 2026
Earnings Call Sentiment Positive
The earnings call was broadly positive: the company reported strong underlying operating momentum (royalty revenue +56% YoY, total revenue +14% YoY, adjusted EPS +23% YoY), meaningful near-term and long-term growth catalysts (Filspari approval and Palvella Phase III success), a transformative announced acquisition (XOMA) expected to be immediately accretive and to materially scale the portfolio, and a strong liquidity position. Key risks discussed include GAAP volatility from equity fair-value movements, lumpy Captisol/contract revenue and timing dependence on partner execution, and remaining uncertainty until the XOMA transaction closes and its tax attributes are fully quantified. Overall, the positives — including multiple high-value clinical and commercial catalysts and a materially enlarged, diversified portfolio — outweigh the highlighted near-term financial and timing uncertainties.Positive Updates
Royalty Revenue Acceleration
Royalty revenue was $43.0M in Q1 2026, up 56% year-over-year, driven primarily by Filspari, Ohtuvayre and Qarziba.
Negative Updates
Fair Value Volatility and Elevated Nonoperating Expense
Nonoperating expense was $41.6M in Q1 2026 versus $14.0M prior year (approximately a +197% increase), driven by changes in fair value of equity holdings (e.g., Pelthos), which contributed to GAAP volatility.
Read all updates
Q1-2026 Updates
Positive
Negative
Royalty Revenue Acceleration
Royalty revenue was $43.0M in Q1 2026, up 56% year-over-year, driven primarily by Filspari, Ohtuvayre and Qarziba.
Read all positive updates
Company Guidance
Ligand reiterated 2026 guidance assuming the XOMA Royalty deal closes in Q3: total revenue $270–$310 million, royalty revenue $225–$250 million and adjusted EPS $8.50–$9.50, with XOMA expected to add ~$0.50 of adjusted EPS in 2026 and ~$1.50 in 2027; the company also expects combined operating cash flow of approximately $300 million (reflecting acquired tax attributes) and plans to deploy $150–$250 million annually into new royalty opportunities. Management noted Q1 results of $52 million total revenue (up 14% YoY), $43 million royalty revenue (up 56% YoY), adjusted EPS $1.63 (up 23% YoY) and GAAP diluted loss per share of $0.67, ending the quarter with ~$780 million cash and investments plus $200 million undrawn revolver (~$1 billion available). Additional near-term guides included Captisol contract revenue visibility to meet a $35–$40 million range and the potential for milestones and additional earnings from XOMA’s portfolio post-close.Ligand Pharma Financial Statement Overview
Summary
Income Statement
86
Very Positive
Balance Sheet
72
Positive
Cash Flow
80
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 274.48M | 268.09M | 167.13M | 131.31M | 196.25M | 241.54M |
| Gross Profit | 270.66M | 261.50M | 156.06M | 96.27M | 143.42M | 179.37M |
| EBITDA | 222.24M | 192.74M | 40.79M | 100.84M | 81.20M | 142.77M |
| Net Income | 153.56M | 124.45M | -4.03M | 52.15M | -33.36M | 57.14M |
Balance Sheet | ||||||
| Total Assets | 1.53B | 1.56B | 941.77M | 787.22M | 762.67M | 1.30B |
| Cash, Cash Equivalents and Short-Term Investments | 779.40M | 733.52M | 256.17M | 170.31M | 211.87M | 341.11M |
| Total Debt | 451.98M | 451.49M | 7.11M | 6.17M | 87.75M | 324.39M |
| Total Liabilities | 534.78M | 543.42M | 111.33M | 86.30M | 165.18M | 476.43M |
| Stockholders Equity | 997.32M | 1.02B | 830.44M | 700.91M | 597.49M | 821.16M |
Cash Flow | ||||||
| Free Cash Flow | 122.96M | 48.91M | 77.41M | -4.27M | 119.93M | 70.04M |
| Operating Cash Flow | 123.42M | 49.36M | 97.05M | 49.58M | 137.85M | 78.80M |
| Investing Cash Flow | -476.56M | -377.32M | -143.66M | -11.68M | 163.62M | 30.52M |
| Financing Cash Flow | 418.84M | 428.22M | 97.14M | -59.95M | -275.99M | -137.76M |
Ligand Pharma Technical Analysis
Positive
231.82
Price Trends
237.63
Positive
219.11
Positive
204.37
Positive
Market Momentum
16.73
Negative
79.81
Negative
93.57
Negative
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 231.82 is below the 20-day moving average (MA) of 255.69, below the 50-day MA of 237.63, and above the 200-day MA of 204.37, indicating a bullish trend. The MACD of 16.73 indicates Negative momentum. The RSI at 79.81 is Negative, neither overbought nor oversold. The STOCH value of 93.57 is Negative, 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 |
|---|---|---|---|---|---|---|---|
77 Outperform | $6.08B | 40.06 | 16.19% | ― | 51.24% | ― | |
57 Neutral | $8.89B | -30.54 | -25.02% | ― | -12.58% | -15.21% | |
56 Neutral | $3.87B | -7.19 | -43.96% | ― | 4905.26% | -34.49% | |
54 Neutral | $1.46B | -5.13 | -85.61% | ― | ― | -68.11% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
50 Neutral | $6.56B | -15.93 | -163.52% | ― | ― | -35.59% |
* Healthcare Sector Average
LGND
Ligand Pharma
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Ligand Pharma Corporate Events
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...
Business Operations and StrategyLegal Proceedings
Ligand Pharma Ends TR‑Beta License With Viking Therapeutics
Negative
Apr 30, 2026
On April 24, 2026, Ligand Pharmaceuticals notified Viking Therapeutics that it will terminate their TR‑Beta Program license, covering assets including VK2809 and VK0214, effective May 4, 2026, citing Viking’s alleged material breach of...
Business Operations and StrategyFinancial DisclosuresLegal ProceedingsM&A Transactions
Ligand Pharma to Acquire XOMA, Expands Royalty Portfolio
Positive
Apr 27, 2026
On April 27, 2026, Ligand Pharmaceuticals agreed to acquire fellow royalty aggregator XOMA Royalty Corporation for $39.00 per share in cash, valuing the target at about $739 million and offering a roughly 14% premium to XOMA’s 30‑day v...
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.