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Ligand Pharma
(NASDAQ:LGND)
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Rating:75Outperform
Price Target:
$336.00
▲(19.92% Upside)
Action:Reiterated
Date:09/24/26
Overall score reflects strong current fundamentals (profitability and cash generation) and a constructive technical uptrend, reinforced by a notably positive earnings call with raised EPS guidance and an accretive XOMA integration/cash flow outlook. The main constraints are increased leverage and a relatively high P/E, with near-term execution and regulatory timing risks highlighted on the call.
Positive Factors
Royalty-model profitability
Ligand’s licensing and royalty model supports very high margins because partners carry much of the development and commercial infrastructure. This capital-efficient structure can convert growing partner sales into durable operating profit and cash generation over the next several quarters.
Negative Factors
Higher leverage
Debt now exceeds equity after a meaningful increase in leverage, raising financial risk compared with Ligand’s historically more conservative profile. Although current cash generation is strong, higher obligations can constrain acquisition capacity and reduce resilience if earnings or royalties normalize lower.
Read all positive and negative factors
Positive Factors
Negative Factors
Royalty-model profitability
Ligand’s licensing and royalty model supports very high margins because partners carry much of the development and commercial infrastructure. This capital-efficient structure can convert growing partner sales into durable operating profit and cash generation over the next several quarters.
Read all positive factors
Ligand Pharma (LGND) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$6.19B
Dividend Yield5.35%
Average Volume (3M)208.28K
Price to Earnings (P/E)31.2
Beta (1Y)0.92
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. Volume264,713
30 Day Avg. Volume208,276
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
$356.29Price Target Upside27.16% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering9
EPS Forecast (FY)9.3
Revenue Forecast (FY)$290.58M
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 through a partnering and licensing model. Key revenue streams typically include: (1) royalties on net sales of partnered products that use Ligand-originated assets or technologies, where Ligand earns a percentage of co...
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
280.18
Price Trends
291.75
Positive
277.70
Positive
240.64
Positive
Market Momentum
5.59
Negative
67.41
Neutral
89.84
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 280.18 is below the 20-day moving average (MA) of 291.91, below the 50-day MA of 291.75, and above the 200-day MA of 240.64, indicating a bullish trend. The MACD of 5.59 indicates Negative momentum. The RSI at 67.41 is Neutral, neither overbought nor oversold. The STOCH value of 89.84 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 68 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 |
|---|---|---|---|---|---|---|---|
75 Outperform | $6.19B | 31.21 | 20.06% | 5.35% | 54.89% | ― | |
61 Neutral | $4.80B | -27.02 | -17.49% | ― | 101.28% | 2.49% | |
57 Neutral | $1.86B | -11.50 | -28.66% | ― | -28.56% | 10.25% | |
54 Neutral | $1.95B | -13.11 | -72.07% | ― | -69.78% | -106.07% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
49 Neutral | $9.36B | -29.22 | -60.54% | ― | 16.85% | -80.39% | |
49 Neutral | $7.63B | -12.90 | -110.84% | ― | -7.49% | -98.12% |
* Healthcare Sector Average
LGND
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Ligand Pharma Corporate Events
Business Operations and StrategyPrivate Placements and Financing
Ligand Pharma Announces $47 Million AvenCell Financing Deal
Positive
Sep 24, 2026
On September 24, 2026, Ligand Pharmaceuticals announced a financing agreement with AvenCell Therapeutics, a clinical-stage cell therapy company developing controllable, allogeneic CAR-T therapies for cancer, for up to $47 million. The deal is stru...
Business Operations and StrategyM&A Transactions
Ligand Pharma Expands Ophthalmology Royalties With Ryjunea Deal
Positive
Sep 22, 2026
Ligand Pharmaceuticals is a U.S.-based biopharmaceutical royalty aggregator that finances and advances late-stage clinical development programs in exchange for long-term economic interests. The company manages one of the industry’s largest d...
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...
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.