Viking Therapeutics stock rating reiterated as Buy by Jefferies

Investing.com - Jefferies has reiterated its Buy rating and $101.00 price target on Viking Therapeutics (NASDAQ:VKTX), maintaining its positive outlook on the $2.8 billion market cap biopharmaceutical company. According to InvestingPro data, analyst targets range from $33 to $125, with the stock showing strong momentum with a 30% gain over the past six months.

The firm believes the market is overreacting to gastrointestinal adverse events and discontinuation profiles associated with Viking’s treatments, while underappreciating potential solutions through dosing optimization.

Jefferies specifically highlighted that these issues could potentially be addressed through a "start low, go slow" dosing strategy, which might improve patient tolerance.

The research note emphasized that Viking’s oral VK2735 demonstrated robust efficacy data, including superior weight loss at upper doses and clinically meaningful weight loss at mid-range doses.

The firm also noted the treatment showed good maintenance potential even at lower doses, all of which support Viking’s plans to advance to oral induction Phase 2b studies and oral maintenance studies.

In other recent news, Viking Therapeutics has announced positive topline results from its Phase 2 VENTURE-Oral Dosing Trial for VK2735, achieving a 12.2% average weight loss from baseline at 13 weeks with the 120 mg dose. Despite these results, the stock experienced a notable decline, which analysts attribute to "sell the news" dynamics. Multiple firms, including H.C. Wainwright, Stifel, and BTIG, have reiterated their Buy ratings, with price targets set at $102.00, $95.00, and $125.00, respectively. The 13-week study showed the oral formulation achieving a 10%-11% weight loss on a placebo-adjusted basis at the highest doses, outperforming competitors like orforglipron and high-dose semaglutide.

However, there are concerns about tolerability and discontinuation rates at higher doses, which may impact Viking’s competitive positioning in the obesity treatment market. Mizuho (NYSE:MFG)’s analysis suggests that Eli Lilly (NYSE:LLY) offers superior obesity treatment results compared to Viking, citing Viking’s clinical data as "inferior" on several metrics. Despite these concerns, Viking’s trial demonstrated dose-dependent weight loss with no plateau effect, achieving statistical significance early in the trial. These developments have kept Viking Therapeutics in the spotlight, as analysts and investors weigh the implications of the trial results and the company’s future prospects in the competitive obesity treatment landscape.

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