Zai Lab Ltd (9688) AI Stock Analysis

• Market Cap: €28.29B
• Dividend Yield: N/A
• Average Volume (3M): 17.37M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.21
• Revenue Growth: 32.07%
• EPS Growth: 33.55%
• Country: HK
• Employees: 1,869
• Sector: Healthcare
• Sector Strength: 45
• Industry: Biotechnology
• EPS (TTM): -0.29
• Shares Outstanding: 1,117,628,000
• 10 Day Avg. Volume: 18,512,011
• 30 Day Avg. Volume: 17,374,638
• PEG Ratio: 0.11
• Price to Book (P/B): 3.16
• Price to Sales (P/S): 6.67
• P/FCF Ratio: -9.63
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €39.28
• Price Target Upside: 54.89% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 48 Neutral
• Price Target: HK$26.00 ▲(2.52% Upside)

Zai Lab Ltd's overall stock score is primarily influenced by its financial performance, which highlights strong revenue growth but significant profitability and cash flow challenges. Technical analysis suggests neutral to slightly bearish momentum, while valuation metrics indicate concerns due to negative earnings and lack of dividends. The absence of earnings call data and corporate events means these factors do not influence the score.

Zai Lab Ltd Business Overview & Revenue Model

Company Description

Zai Lab Limited develops and commercializes therapies to treat oncology, autoimmune disorders, infectious diseases, and neuroscience primarily in Mainland China and Hong Kong. The company's commercial products include Zejula, a once-daily small-molecule poly polymerase 1/2 inhibitor; Optune, a device that delivers tumor treating fields; NUZYRA for acute bacterial skin and skin structure infections, and community acquired bacterial pneumonia; and Qinlock to treat gastrointestinal stromal tumors. It also develops Odronextamab to treat follicular lymphoma, diffuse large B-cell lymphoma, and other B-celllymphomas; Repotrectinib, a tyrosine kinase inhibitor (TKI) to target ROS1 and TRK A/B/C in TKI-naïve- or -pretreated cancer patients; Margetuximab for the treatment of breast and gastroesophageal cancers; Adagrasib for treating KRAS-G12C-mutated NSCLC, colorectal cancer, pancreatic cancer, and other solid tumors; and Bemarituzumab to treat gastric and gastroesophageal junction cancer. In addition, the company develops CLN-081 for the treatment of patients with EGFR exon 20 insertion NSCLC; Elzovantinib, an orally bioavailable multi-targeted kinase inhibitor; Tebotelimab, a tetravalent IgG4 monoclonal antibody; Retifanlimab that inhibits interactions between PD-1 and its ligands; ZL-2309, an orally active, selective, and ATP-competitive cell division cycle 7 (CDC7) kinase inhibitor; ZL-1201, a humanized IgG4 monoclonal antibody; Efgartigimod to reduce disease-causing immunoglobulin G antibodies; ZL-1102, a human nanobody targeting interleukin- 17A; KarXT for the treatment of psychiatric and neurological conditions; ZL-2313, an investigational inhibitor of triple-mutant EGFR harboring; ZL-2314, an investigational inhibitor of double-mutant EGFR harboring; and Sulbactam/durlobactam for the treatment of serious infections caused by Acinetobacter. Zai Lab Limited was incorporated in 2013 and is headquartered in Shanghai, China.

How the Company Makes Money

Zai Lab Ltd primarily generates revenue through the commercialization and sales of its pharmaceutical products. The company has a diverse revenue model that includes direct sales of approved therapies, milestone payments, and royalties from strategic partnerships and licensing agreements with global pharmaceutical companies. These partnerships often involve co-development and co-commercialization of drug candidates, which provide Zai Lab with upfront payments and a share of future sales. Additionally, Zai Lab invests in its pipeline of drug candidates, which, upon successful approval and market entry, contribute significantly to its revenue streams. The company's earnings are also influenced by its ability to expand market access and grow its presence in the rapidly evolving Chinese healthcare sector.

Zai Lab Ltd Financial Statement Overview

Summary

Zai Lab Ltd exhibits strong revenue growth and a solid gross profit margin, but faces significant profitability and cash flow challenges. The balance sheet is stable with low leverage, yet the negative return on equity and persistent losses indicate a need for strategic improvements to enhance profitability and cash flow management.

Income Statement

Zai Lab Ltd has shown consistent revenue growth, with a TTM revenue growth rate of 2.27%. However, the company is struggling with profitability, as indicated by negative net profit margins and EBIT margins. The gross profit margin remains strong at 63.45% for TTM, but the persistent negative net income and EBIT suggest challenges in managing operational costs.

Balance Sheet

The company maintains a low debt-to-equity ratio of 0.24, indicating conservative leverage. However, the return on equity is negative, reflecting ongoing losses and challenges in generating shareholder value. The equity ratio is stable, suggesting a solid capital structure despite profitability issues.

Cash Flow

Zai Lab Ltd's cash flow situation is concerning, with negative operating and free cash flows. The free cash flow to net income ratio is positive, indicating some efficiency in cash flow management relative to net losses. However, the negative free cash flow growth rate of -3.29% in TTM highlights cash flow challenges.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	427.80M	398.99M	266.72M	215.04M	144.31M	48.96M
Gross Profit	266.92M	251.13M	170.90M	141.02M	92.07M	32.22M
EBITDA	-195.33M	-242.99M	-365.11M	-384.66M	-689.46M	-262.96M
Net Income	-212.52M	-257.10M	-334.62M	-481.99M	-692.44M	-298.16M
Balance Sheet
Total Assets	1.16B	1.19B	1.04B	1.22B	1.61B	1.30B
Cash, Cash Equivalents and Short-Term Investments	732.16M	779.67M	806.45M	1.01B	1.41B	1.19B
Total Debt	191.40M	153.47M	15.15M	20.39M	15.54M	18.60M
Total Liabilities	372.37M	344.86M	240.18M	174.54M	230.00M	128.29M
Stockholders Equity	791.74M	840.90M	796.12M	1.05B	1.38B	1.17B
Cash Flow
Free Cash Flow	-230.99M	-276.39M	-206.67M	-392.63M	-568.18M	-226.72M
Operating Cash Flow	-175.31M	-214.87M	-198.18M	-367.64M	-549.23M	-216.06M
Investing Cash Flow	-54.43M	-375.19M	-10.78M	420.02M	249.96M	-554.83M
Financing Cash Flow	332.01M	349.89M	-6.43M	-1.73M	820.20M	1.13B

Zai Lab Ltd Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 25.36
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:9688, the sentiment is Negative. The current price of 25.36 is above the 20-day moving average (MA) of 25.27, below the 50-day MA of 27.27, and above the 200-day MA of 25.33, indicating a neutral trend. The MACD of -0.51 indicates Negative momentum. The RSI at 46.72 is Neutral, neither overbought nor oversold. The STOCH value of 81.90 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:9688.

Zai Lab Ltd Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2696	70 Outperform	42.18B	47.39	27.23%	―	2.57%	18.79%
9966	64 Neutral	11.45B	44.90	9.08%	―	206.58%	0.00%
2157	57 Neutral	14.22B	-67.94	-58.53%	―	240.05%	-140.09%
1877	54 Neutral	45.19B	-28.10	-21.86%	―	44.21%	46.11%
9688	48 Neutral	€28.29B	―	-29.51%	―	32.07%	33.55%
9995	47 Neutral	60.94B	-45.64	-73.93%	―	47.62%	28.72%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%

Zai Lab Ltd Corporate Events

Zai Lab Limited Announces Equity Incentive Grants

Zai Lab Limited announced the grant of share options and restricted share units under its 2024 Equity Incentive Plan. On September 8, 2025, the company granted options to subscribe for 6,600 American Depositary Shares (ADSs) to two employees and 9,893 restricted share units to four employees. These grants are part of the company’s strategy to align employee incentives with its long-term goals, although they do not include performance targets or clawback mechanisms. The move is seen as market competitive and consistent with the company’s customary practices.

The most recent analyst rating on (HK:9688) stock is a Hold with a HK$22.00 price target. To see the full list of analyst forecasts on Zai Lab Ltd stock, see the HK:9688 Stock Forecast page.

Zai Lab Awaits Further Study Results Before Regulatory Filing

Zai Lab Limited announced an update on the Phase 3 FORTITUDE-101 study, conducted in partnership with Amgen, evaluating bemarituzumab combined with chemotherapy for first-line gastric cancer. While the interim analysis showed significant improvement in overall survival, the final analysis indicated a reduced benefit. The company plans to await results from the FORTITUDE-102 study before proceeding with regulatory filings, with data expected by late 2025 or early 2026.

The most recent analyst rating on (HK:9688) stock is a Hold with a HK$27.00 price target. To see the full list of analyst forecasts on Zai Lab Ltd stock, see the HK:9688 Stock Forecast page.

Zai Lab Reports Strong Revenue Growth and Reduced Losses in H1 2025

Zai Lab Limited announced its unaudited interim results for the six months ending June 30, 2025, showing a 15% increase in net product revenue to $214.7 million, driven by higher sales of key products. The company also reported a decrease in net loss by 33% to $89.2 million, attributed to revenue growth outpacing operating expenses, alongside reduced research and development, and administrative costs due to resource prioritization and efficiency efforts.

The most recent analyst rating on (HK:9688) stock is a Hold with a HK$27.00 price target. To see the full list of analyst forecasts on Zai Lab Ltd stock, see the HK:9688 Stock Forecast page.