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Madrigal Pharmaceuticals Inc (MDGL)
NASDAQ:MDGL
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Madrigal Pharmaceuticals
(NASDAQ:MDGL)
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Rating:55Neutral
Price Target:
$448.00
▲(2.99% Upside)
Action:ReiteratedDate:02/20/26
The score is driven primarily by strong financial momentum (sharp revenue scaling, very high gross margins, and minimal leverage) but held back by continued net losses and negative free cash flow. Technical indicators are weak with the stock below key moving averages and negative MACD, while the earnings call was constructive on growth and market opportunity but highlighted near-term gross-to-net and expense pressures.
Positive Factors
Revenue Scaling & Unit Economics
Rapid revenue scaling to ~$958M in 2025 with exceptionally high gross margins (~94–97%) indicates strong product-market fit and attractive unit economics. Durable commercial traction and favorable margins create structural optionality to fund growth and improve operating leverage over the next 2–6 months.
Strong Cash Position & Low Leverage
Nearly $1.0B of liquidity combined with negligible debt provides a multi-quarter runway to support commercialization, payer negotiations, and pipeline investments without immediate financing. This conservative leverage profile reduces short-term solvency risk and preserves strategic optionality for partnerships or M&A.
Long Patent Protection and IP Control
Extended exclusivity to 2045 and expanded control over patent term adjustments materially lengthen the commercial runway for Rezdiffra. This durable IP position lowers competitive risk, supports long-term pricing and payer negotiations, and enhances the asset value underpinning the company’s strategic planning.
Negative Factors
Negative Cash Flow
Despite revenue growth, the company remains cash flow negative (operating and free cash flow around -$190M in 2025). Continued burn, even if improved versus 2024, creates execution risk if commercial momentum or payer access slows, potentially forcing spending cuts or incremental capital raises.
Gross-to-Net Deterioration
Anticipated gross‑to‑net worsening into the high‑30% range from payer contracting materially reduces net revenue capture per unit sold. This structural payer pressure can persist as contracting expands, compressing margins and requiring durable payer strategy or higher volume to preserve net growth.
Rising Operating Expenses
Substantial 2025 BD-related upfronts and elevated R&D/SG&A to support launch and acquisitions increased burn. With R&D and sales costs expected to rise in 2026, operating leverage is pressured and profitability timelines are delayed, increasing funding need if revenue growth lags expectations.
Madrigal Pharmaceuticals (MDGL) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$10.09B
Dividend YieldN/A
Average Volume (3M)343.53K
Price to Earnings (P/E)―
Beta (1Y)0.41
Revenue Growth864.21%
EPS Growth48.12%
CountryUS
Employees528
SectorHealthcare
Sector Strength45
IndustryBiotechnology
Share Statistics
EPS (TTM)-2.57
Shares Outstanding22,939,968
10 Day Avg. Volume406,939
30 Day Avg. Volume343,533
Financial Highlights & Ratios
PEG Ratio1.10
Price to Book (P/B)21.68
Price to Sales (P/S)13.63
P/FCF Ratio-68.75
Enterprise Value/Market Cap0.99
Enterprise Value/Revenue10.47
Enterprise Value/Gross Profit11.12
Enterprise Value/Ebitda-37.95
Forecast
1Y Price Target
$694.90Price Target Upside59.74% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering11
EPS Forecast (FY)-3.55
Revenue Forecast (FY)$1.48B
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:Feb 19, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 12, 2026
Earnings Call Sentiment Positive
The call communicated a strong, high-performing commercial launch (nearly $1B first-year sales), accelerating patient uptake, a sizable and fast-growing U.S. addressable market, a cash-strong balance sheet, and rapid pipeline expansion anchored to Rezdiffra (patent protection to 2045). Key near-term headwinds include expected gross-to-net deterioration into the high 30% range in 2026 (reducing net revenue), Q1 seasonality and contracting timing effects, higher R&D/SG&A from business-development and launch investments, and limited near-term international revenue. Management portrayed confidence in continued robust growth, disciplined R&D/combination strategy, and an adaptive approach to payer partnerships and persistence initiatives.Q4-2025 Updates
Positive Updates
Exceptional Launch Sales
Fourth quarter 2025 net sales of $321,100,000 (more than triple Q4 2024) and full year 2025 net sales of $958,400,000 — a nearly $1.0B first full year on market, characterized by strong demand and market build-out.
Rapid Patient Growth
Patients on Rezdiffra rose to more than 36,250 at the end of Q4 2025 from more than 29,500 at the end of Q3 2025 — an increase of ~6,750 patients quarter-over-quarter (~22.9% QoQ), indicating steady quarterly net patient adds.
Large and Expanding U.S. NASH Market
Company reports the U.S. F2–F3 target population seen by target specialists expanded nearly 50% since 2023 (discussed range from ~315,000 toward ~460,000 representative patients) and expects the market to grow at a double-digit pace for the foreseeable future.
Pipeline Expansion and Strategic Acquisitions
Company built a pipeline of more than 10 programs via three transactions within ~6 months, adding an oral GLP-1 (phase 1 single-ascending dose study MGL-2086 expected Q2), a late-stage DGAT2 inhibitor (Evogastat), and six preclinical siRNA targets — all intended for combination strategies with Rezdiffra.
Positive Evogastat Phase 2b Evidence
Evogastat (DGAT2 inhibitor) previously completed a phase 2b trial (MIRNA): at the 150 mg dose 72% of patients achieved ≥30% MRI-PDFF reduction and 61% achieved ≥50% reduction — labeled as 'super responder' levels predictive of greater likelihood of fibrosis reversal.
Encouraging F4C Open-Label Data
Two-year open-label NAFLD1 data (122 patients) showed 65% of patients with clinically significant portal hypertension (CSPH) at baseline moved into lower risk categories by year two, supporting Rezdiffra's potential in F4C and informing the outcomes trial design.
Extended Patent Protection and International Launch Start
Rezdiffra patent exclusivity extended to 2045 and ex-U.S. rollout initiated (Germany), positioning a long commercial runway and the start of international expansion.
Strong Balance Sheet
Cash, cash equivalents, restricted cash, and marketable securities totaled $988,600,000 at year-end 2025, providing resources to support launch, pipeline advancement, and further business development.
Negative Updates
Gross-to-Net Pressure and Net Revenue Compression
Full-year 2025 gross-to-net impact finished at the low end of the previously guided 20%–30% range, but company expects gross-to-net to move into the high 30% range in 2026 due to payer contracting — a material headwind to net sales realization.
Q1 and Contracting Timing Headwinds
Typical Q1 dynamics (benefit-plan changes and reverifications) are expected to cause a mid- to high-single-digit sequential net sales decline, compounded by the 'zero-to-contracting' impact as broad first-line contracts took effect January 1, 2026.
Rising Operating Expenses from Business Development and Launch
R&D expenses for 2025 were $388,500,000 (Q4 R&D $116,300,000) and increased largely due to business-development upfront payments (e.g., $120,000,000 for oral GLP-1 in Q3 and $50,000,000 for Evogastat and other assets in Q4). SG&A also materially increased in 2025 to support the launch and is expected to rise further in 2026 — pressure on profitability/operating leverage.
Limited Near-Term International Contribution
Germany/ex-U.S. contribution to 2025 revenues was negligible and management does not expect meaningful ex-U.S. contribution in 2026 amid MFN/industry-wide uncertainty about international rollout timing and pricing dynamics.
Adherence and Persistence Uncertainty
Company reports typical well-tolerated oral persistence in the ~60%–70% range at one year (though some institutions report ~90%), signaling variability and risk that lower real-world persistence could negatively affect long-term revenue; the company is running patient-support initiatives to improve persistence.
Data Timing and Regulatory Uncertainties
MAESTRO outcomes (F4C event-driven study) is tracking events in expected ranges with data targeted for 2027, but as an event-driven and regulatory-dependent readout this timing introduces uncertainty for the F4C indication expansion and full-approval pathway.
Company Guidance
Management guided to continued robust growth in 2026 off a strong 2025 launch (Q4 net sales $321.1M, FY2025 net sales $958.4M; Q4 >36,250 patients on Rezdiffra vs >29,500 at end‑Q3), highlighted a large addressable F2–F3 specialist population (315,000 representative patients, up nearly 50% since 2023) and an F4C opportunity of ~245,000 patients that could roughly double the commercial opportunity; Rezdiffra has patent protection into 2045, the company ended 2025 with $988.6M cash, R&D spend was $116.3M in Q4 and $388.5M for FY2025 (2026 R&D expected roughly flat), and FY2025 gross‑to‑net landed at the low end of the 20–30% range with 2026 gross‑to‑net expected in the high‑30s (Q1 typically a mid‑ to high‑single‑digit net sales step down due to reverifications plus the zero‑to‑contracting impact); pipeline metrics include >10 programs (oral GLP‑1 Phase 1 expected in Q2, a late‑stage DGAT2 Evogastat with MIRNA PDFF responses of 72% ≥30% and 61% ≥50% at 150 mg, and six preclinical siRNAs), MAESTRO outcomes remain on track for 2027 data with expected placebo event accrual of ~5–10% annually, and real‑world persistence runs ~60–70% at one year (with some sites up to ~90%).Madrigal Pharmaceuticals Financial Statement Overview
Summary
Explosive revenue growth ($180M in 2024 to $958M in 2025) and exceptional gross margins (~94–97%) are strong positives, and the balance sheet is conservatively levered (near-zero debt). Offsetting this, profitability and cash generation remain negative (2025 net income -$288M; operating/free cash flow about -$190M), though losses and burn are improving versus 2024.Income Statement
Revenue has scaled sharply, rising from $180M (2024) to $958M (2025), indicating strong commercial traction. Gross margin is exceptionally high (~94–97%), reflecting attractive unit economics. However, profitability remains negative: 2025 net income was -$288M (about -30% margin), though losses improved materially versus 2024 (-$466M, about -259% margin), showing improving operating leverage but still meaningful ongoing burn.42
Neutral
Balance Sheet
The balance sheet looks conservatively levered, with total debt near zero in 2025 (~$1M) and a very low debt-to-equity ratio, providing financial flexibility. Equity is sizeable at ~$603M alongside ~$1.26B of assets. The key weakness is returns: losses translate into negative return on equity (2025), meaning the company is still destroying accounting value despite the de-risked leverage profile.74
Positive
Cash Flow
Cash generation remains negative, with 2025 operating cash flow of about -$190M and free cash flow around -$190M, consistent with ongoing investment and losses. The cash burn improved significantly versus 2024 (operating cash flow -$456M), a positive trajectory. Still, free cash flow remains firmly below zero, leaving continued execution risk if spending does not moderate or revenue growth slows.45
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 958.40M | 180.13M | 0.00 | 0.00 | 0.00 |
| Gross Profit | 902.25M | 173.90M | 0.00 | 0.00 | 0.00 |
| EBITDA | -264.47M | -450.13M | -360.39M | -290.92M | -241.44M |
| Net Income | -288.28M | -465.89M | -373.63M | -295.35M | -241.85M |
Balance Sheet | |||||
| Total Assets | 1.26B | 1.04B | 640.55M | 362.57M | 273.33M |
| Cash, Cash Equivalents and Short-Term Investments | 983.56M | 926.25M | 634.13M | 358.77M | 270.35M |
| Total Debt | 354.36M | 119.57M | 117.19M | 49.89M | 797.00K |
| Total Liabilities | 656.90M | 287.86M | 235.21M | 165.18M | 77.22M |
| Stockholders Equity | 602.69M | 754.38M | 405.33M | 197.39M | 196.11M |
Cash Flow | |||||
| Free Cash Flow | -190.02M | -457.03M | -325.71M | -225.07M | -184.13M |
| Operating Cash Flow | -189.55M | -455.57M | -324.23M | -224.86M | -183.92M |
| Investing Cash Flow | 32.32M | -274.39M | -502.52M | 206.69M | -5.05M |
| Financing Cash Flow | 255.98M | 735.06M | 595.12M | 313.45M | 171.24M |
Madrigal Pharmaceuticals Technical Analysis
Negative
435.01
Price Trends
516.24
Negative
505.21
Negative
424.06
Positive
Market Momentum
-19.92
Positive
33.33
Neutral
18.01
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MDGL, the sentiment is Negative. The current price of 435.01 is below the 20-day moving average (MA) of 471.12, below the 50-day MA of 516.24, and above the 200-day MA of 424.06, indicating a neutral trend. The MACD of -19.92 indicates Positive momentum. The RSI at 33.33 is Neutral, neither overbought nor oversold. The STOCH value of 18.01 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative 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
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $11.72B | 16.08 | 35.53% | ― | 9.93% | 54.33% | |
61 Neutral | $20.23B | -24.53 | -17.11% | ― | -83.82% | -109.22% | |
57 Neutral | $14.42B | -54.32 | ― | ― | 103.32% | 47.55% | |
56 Neutral | $13.84B | -32.81 | -39.99% | ― | 20.39% | 34.00% | |
55 Neutral | $10.09B | -33.82 | -42.49% | ― | 864.21% | 48.12% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
50 Neutral | $13.16B | -17.58 | ― | ― | 62.46% | -73.59% |
* Healthcare Sector Average
MDGL
Madrigal Pharmaceuticals
435.01
99.27
29.57%
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ROIV
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Madrigal Pharmaceuticals Corporate Events
Business Operations and Strategy
Madrigal Gains Expanded Patent Control Over Rezdiffra With Roche
Positive
Jan 30, 2026
On January 29, 2026, Madrigal Pharmaceuticals and Roche amended their long-standing research, development, and commercialization agreement, giving Madrigal full and exclusive control over all patent term adjustments and extensions related to Rezdiffra, including those on patents owned by Roche or jointly held. In return, Madrigal agreed that royalties paid to Roche on net sales of Rezdiffra will remain at current levels and will not be reduced until certain existing or potential patent term extensions expire, a move that strengthens Madrigal’s strategic control over a key asset while maintaining Roche’s royalty economics for a longer period, with implications for both companies’ revenue visibility and IP positioning around Rezdiffra.
The most recent analyst rating on (MDGL) stock is a Buy with a $587.00 price target. To see the full list of analyst forecasts on Madrigal Pharmaceuticals stock, see the MDGL Stock Forecast page.
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.