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Madrigal Pharmaceuticals Inc (MDGL)
NASDAQ:MDGL

Madrigal Pharmaceuticals (MDGL) AI Stock Analysis

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Madrigal Pharmaceuticals

(NASDAQ:MDGL)

Rating:56Neutral
Price Target:
Madrigal Pharmaceuticals presents a mixed investment case. Strong revenue growth and a successful product launch boost its appeal, but profitability remains a challenge due to high operational costs. The stable balance sheet offers some reassurance, though ongoing cash burn and external financing reliance are risks. Technical indicators suggest a neutral stance with potential for growth, while the valuation reflects the high-risk nature typical of biotech firms.
Positive Factors
Clinical Trial Results
Resmetirom demonstrated encouraging results from the Phase 3 MAESTRO-NASH trial in F2/3 patients, meeting both dual primary endpoints with a consistent safety profile.
Market Launch Strategy
MDGL plans to initiate the EU launch on a country-by-country basis, beginning with Germany, suggesting EU providers may be more prepared to utilize Rezdiffra than their U.S. counterparts.
Regulatory Approval
The Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency has adopted a positive opinion recommending conditional approval of Rezdiffra for the treatment of adults with noncirrhotic MASH with moderate to advanced liver fibrosis.
Negative Factors
Investor Sentiment
Investor reaction remains muted following the conference.
Market Uncertainty
Absent greater de-risking, there are still downside risks to the story.

Madrigal Pharmaceuticals (MDGL) vs. SPDR S&P 500 ETF (SPY)

Madrigal Pharmaceuticals Business Overview & Revenue Model

Company DescriptionMadrigal Pharmaceuticals, Inc., a clinical-stage biopharmaceutical company, focuses on the development and commercialization of therapeutic candidates for the treatment of cardiovascular, metabolic, and liver diseases. Its lead product candidate is resmetirom, a liver-directed selective thyroid hormone receptor-ß agonist, which is in Phase III clinical trials for the treatment of non-alcoholic steatohepatitis. The company also develops MGL-3745, a backup compound to resmetirom. It has research, development, and commercialization agreement with Hoffmann-La Roche. Madrigal Pharmaceuticals, Inc. is headquartered in West Conshohocken, Pennsylvania.
How the Company Makes MoneyMadrigal Pharmaceuticals primarily makes money through the development and commercialization of its proprietary drug candidates. The company aims to generate revenue by advancing its lead compound, resmetirom, through clinical trials and obtaining regulatory approval for commercialization. Once approved, Madrigal would earn revenue through product sales, potentially entering into licensing agreements or partnerships with larger pharmaceutical companies to expand market reach and distribution. The company's financial success is also supported by strategic collaborations and partnerships that may provide upfront payments, milestone payments, and royalties. Madrigal's revenue model is highly dependent on the successful clinical development and regulatory approval of its drug candidates.

Madrigal Pharmaceuticals Earnings Call Summary

Earnings Call Date:May 01, 2025
(Q1-2025)
|
% Change Since: -5.77%|
Next Earnings Date:Aug 06, 2025
Earnings Call Sentiment Positive
The earnings call highlighted the successful launch and significant growth of Rezdiffra, with strong financial performance and upcoming regulatory milestones in Europe. However, there are challenges with increased operational expenses and uncertainties in the European market strategy.
Q1-2025 Updates
Positive Updates
Successful US Launch of Rezdiffra
Achieved over 80% commercial payer coverage and treated more than 17,000 patients, generating $317 million in net sales in the first 12 months.
Strong Q1 2025 Financial Performance
Net sales for Q1 2025 were $137 million, up 33% quarter-over-quarter, despite typical Q1 headwinds.
Significant Growth in Patient Adoption
Ended Q1 2025 with more than 17,000 patients on Rezdiffra, up from 11,800 at the end of Q4 2024.
High Physician Penetration Rate
70% of the 6,000 top target prescribers have prescribed Rezdiffra, demonstrating strong healthcare provider engagement.
Compelling Two-Year F4c Data
Patients saw a mean reduction of 6.7 kilopascals in liver stiffness at two years, suggesting many patients are moving into a lower risk category.
Upcoming Regulatory Decision in Europe
On track for a mid-year regulatory decision in Europe with plans to launch in Germany in the second half of the year.
Strong Financial Position
Ended Q1 2025 with $848.1 million in cash, cash equivalents, restricted cash, and marketable securities.
Negative Updates
Increased SG&A Expenses
SG&A expenses for Q1 2025 were $167.9 million, up from $80.8 million in Q1 2024, due to increases in commercial launch activities and headcount.
Expected Increase in Gross to Net Discount
Gross to net discount expected to increase throughout 2025 as payer contracting begins.
Uncertainty in European Launch Strategy
Questions remain on the European launch strategy and pricing, particularly in relation to non-invasive testing acceptance.
Company Guidance
During the first quarter of 2025, Madrigal Pharmaceuticals reported impressive performance metrics for Rezdiffra, the first FDA-approved medicine for MASH. Rezdiffra generated $137 million in net sales, representing a 33% increase quarter-over-quarter, with 17,000 patients actively on therapy, up from 11,800 at the end of 2024. The product achieved over 80% commercial payer coverage and secured a 70% prescription rate among their top 6,000 target prescribers. Rezdiffra's real-world profile demonstrates a 6.7 kPa reduction in liver stiffness in F4c patients, which is associated with a lower risk of progression to end-stage liver disease. As of Q1 2025, Madrigal maintains a strong financial position with $848.1 million in cash and equivalents, supporting continued US launch efforts and anticipated European expansion.

Madrigal Pharmaceuticals Financial Statement Overview

Summary
Madrigal Pharmaceuticals is experiencing significant revenue growth with the introduction of Rezdiffra, but profitability remains a challenge due to negative EBIT and net income margins. The balance sheet is strong with low leverage, yet ongoing cash burn due to negative free cash flow and reliance on external financing are concerns.
Income Statement
45
Neutral
Madrigal Pharmaceuticals is experiencing significant revenue growth, as evidenced by the jump from zero revenue in prior years to $317 million in TTM. However, the company is not yet profitable, with negative EBIT and net income margins. This indicates high operational costs relative to revenue, which is a common challenge in the biotechnology industry during the R&D phase.
Balance Sheet
55
Neutral
The company's balance sheet shows a strong equity position with a low debt-to-equity ratio, highlighting financial stability. The equity ratio is healthy, reflecting a solid asset base funded by stockholders' equity. However, continuous losses can erode this stability over time.
Cash Flow
50
Neutral
Cash flow analysis indicates negative free cash flow, which is typical for biotech firms focusing on research and development. The operating cash flow remains negative, suggesting ongoing cash burn. While financing activities have been a source of cash, reliance on external funding can be a concern if not managed properly.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue317.38M180.13M0.000.000.000.00
Gross Profit306.81M173.90M-527.00K-467.00K-405.00K-471.00K
EBITDA-376.15M-450.13M-379.97M-290.92M-242.08M-206.20M
Net Income-391.59M-465.89M-373.63M-295.35M-241.85M-202.24M
Balance Sheet
Total Assets996.63M1.04B640.55M362.57M273.33M287.00M
Cash, Cash Equivalents and Short-Term Investments843.07M926.25M634.13M358.77M270.35M284.15M
Total Debt119.77M119.57M117.19M49.89M797.00K786.00K
Total Liabilities285.99M287.86M235.21M165.18M77.22M47.02M
Stockholders Equity710.64M754.38M405.33M197.39M196.11M239.97M
Cash Flow
Free Cash Flow-401.41M-457.03M-325.71M-225.07M-184.13M-157.90M
Operating Cash Flow-395.31M-455.57M-324.23M-224.86M-183.92M-157.56M
Investing Cash Flow-208.56M-274.39M-502.52M206.69M-5.05M159.78M
Financing Cash Flow170.00M735.06M595.12M313.45M171.24M5.09M

Madrigal Pharmaceuticals Technical Analysis

Technical Analysis Sentiment
Positive
Last Price314.64
Price Trends
50DMA
291.65
Positive
100DMA
309.68
Positive
200DMA
299.12
Positive
Market Momentum
MACD
4.18
Negative
RSI
63.47
Neutral
STOCH
70.25
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MDGL, the sentiment is Positive. The current price of 314.64 is above the 20-day moving average (MA) of 293.39, above the 50-day MA of 291.65, and above the 200-day MA of 299.12, indicating a bullish trend. The MACD of 4.18 indicates Negative momentum. The RSI at 63.47 is Neutral, neither overbought nor oversold. The STOCH value of 70.25 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MDGL.

Madrigal Pharmaceuticals Risk Analysis

Madrigal Pharmaceuticals disclosed 50 risk factors in its most recent earnings report. Madrigal Pharmaceuticals reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Madrigal Pharmaceuticals Peers Comparison

Overall Rating
UnderperformOutperform
Sector (46)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
78
Outperform
$6.97B15.29147.06%25.65%57.10%
69
Neutral
$7.23B61.5321.52%30.93%11.78%
60
Neutral
$8.20B35.68%-41.71%-9.37%
56
Neutral
$6.38B-50.16%21.83%
54
Neutral
$7.38B1.93-8.56%-38.94%-104.46%
52
Neutral
$6.79B-36.68%-100.00%5.49%
46
Neutral
C$198.48M-3.49-23.22%2.62%21.07%-1.26%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
MDGL
Madrigal Pharmaceuticals
314.64
28.78
10.07%
CORT
Corcept Therapeutics
72.01
40.51
128.60%
HALO
Halozyme
57.63
4.45
8.37%
BBIO
BridgeBio Pharma
46.27
19.15
70.61%
RVMD
Revolution Medicines
38.50
-6.64
-14.71%
ROIV
Roivant Sciences
11.57
0.22
1.94%

Madrigal Pharmaceuticals Corporate Events

Executive/Board Changes
Madrigal Pharmaceuticals Announces Leadership Transition
Neutral
Apr 17, 2025

On April 16, 2025, Madrigal Pharmaceuticals announced that Dr. Rebecca Taub will transition from her role as Chief Medical Officer and President of Research and Development to a Senior Scientific and Medical Advisor role effective April 21, 2025. Dr. Taub will continue to support the company’s metabolic dysfunction-associated steatohepatitis programs and remain on the Board of Directors. She will receive her 2025 base salary and be eligible for a performance-based bonus. Additionally, Dr. Taub entered into a Severance and Change of Control Agreement, entitling her to severance benefits under certain conditions, including a continuation of her salary and health benefits, should her employment be terminated without cause or for good reason.

Spark’s Take on MDGL Stock

According to Spark, TipRanks’ AI Analyst, MDGL is a Neutral.

Madrigal Pharmaceuticals’ overall score reflects significant challenges in profitability and cash flow generation, offset by strong product launch and positive technical indicators. The company’s strategic progress and strong financial position are promising, but valuation concerns remain due to ongoing losses.

To see Spark’s full report on MDGL stock, click here.

Executive/Board ChangesBusiness Operations and Strategy
Madrigal Pharmaceuticals Expands Board with New Appointment
Neutral
Mar 11, 2025

On March 9, 2025, Fred Craves announced his resignation from Madrigal Pharmaceuticals’ Board of Directors, effective July 1, 2025, without any disagreements with the company. Subsequently, the Board expanded to include Jackie Fouse, Ph.D., an experienced biotech executive, who will serve on the Audit and Nominating and Governance Committees. This change reflects Madrigal’s commitment to leadership in the MASH sector, with plans to drive the launch of Rezdiffra, expand geographically, and advance their clinical program.

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.Date of analysis: May 04, 2025