In 2025, the prospects for Viking Therapeutics stock will become clearer.
Viking Therapeutics (VKTX) experienced a 2.3% increase in stock value by 10:20 a.m. ET on Monday, driven by an intriguing development. Truist Securities analyst Joon Lee lowered the price target for this unprofitable biotech stock. This decision, paradoxically, is viewed positively by some investors.
According to Lee, the price target for Viking was reduced from $95 to $75 a share due to “intensifying competition in the obesity space.” However, he also suggested that 2025 will be a crucial year for Viking as it embarks on phase 3 clinical trials for its new GLP-1 obesity drug, VK2735.
Successful results from these trials could position Viking as a significant player in the weight-loss market, alongside companies like Novo Nordisk and Eli Lilly. Even securing a minor share of the global GLP-1 drug market could substantially impact Viking’s financial performance.
Analysts have noted that as Viking currently lacks revenue or profits, bringing any drug to market would be a significant achievement. The company is expected to generate under $2 million in revenue this year, with projections growing to $38 million by 2027 and $729 million by 2029, the year analysts anticipate profitability.
For Viking to achieve success, multiple factors must align favorably, and setbacks could occur if phase 3 trials do not succeed. Given these uncertainties, Viking is considered a speculative stock, and investors are advised to exercise caution by investing modestly and maintaining a diversified portfolio.
Rich Smith, the author, holds no positions in the mentioned stocks. The Motley Fool holds positions in, and recommends, Truist Financial, Novo Nordisk, and Viking Therapeutics.
