NasdaqGM:LGND

Stock Analysis Report

Executive Summary

Ligand Pharmaceuticals Incorporated, a biopharmaceutical company, focuses on developing and acquiring technologies that help pharmaceutical companies to discover and develop medicines worldwide.

Rewards

PE ratio (3.6x) is below the US market (18.7x)

Revenue is forecast to grow 10.14% per year

Earnings grew by 232.3% over the past year

Risk Analysis

Earnings are forecast to decline by an average of -137.1% per year for the next 3 years

Interest payments are not well covered by earnings

Large one-off items impacting financial results



Snowflake Analysis

Solid track record and fair value.


Similar Companies

Share Price & News

How has Ligand Pharmaceuticals's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: LGND has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

1.8%

LGND

0.8%

US Biotechs

1.3%

US Market


1 Year Return

-24.6%

LGND

16.4%

US Biotechs

19.4%

US Market

Return vs Industry: LGND underperformed the US Biotechs industry which returned 16.4% over the past year.

Return vs Market: LGND underperformed the US Market which returned 19.4% over the past year.


Shareholder returns

LGNDIndustryMarket
7 Day1.8%0.8%1.3%
30 Day-1.5%8.9%2.6%
90 Day9.6%16.0%5.0%
1 Year-24.6%-24.6%17.4%16.4%22.0%19.4%
3 Year-1.2%-1.2%27.2%23.0%46.8%37.3%
5 Year104.9%104.9%4.6%-0.5%66.3%48.0%

Price Volatility Vs. Market

How volatile is Ligand Pharmaceuticals's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Ligand Pharmaceuticals undervalued compared to its fair value and its price relative to the market?

3.59x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: LGND ($106.84) is trading above our estimate of fair value ($58.89)

Significantly Below Fair Value: LGND is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: LGND is good value based on its PE Ratio (3.6x) compared to the Biotechs industry average (18.8x).

PE vs Market: LGND is good value based on its PE Ratio (3.6x) compared to the US market (18.7x).


Price to Earnings Growth Ratio

PEG Ratio: LGND's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: LGND is good value based on its PB Ratio (2.2x) compared to the US Biotechs industry average (3.3x).


Next Steps

Future Growth

How is Ligand Pharmaceuticals forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

-137.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: LGND's earnings are forecast to decline over the next 3 years (-137.1% per year).

Earnings vs Market: LGND's earnings are forecast to decline over the next 3 years (-137.1% per year).

High Growth Earnings: LGND's earnings are forecast to decline over the next 3 years.

Revenue vs Market: LGND's revenue (10.1% per year) is forecast to grow faster than the US market (7.3% per year).

High Growth Revenue: LGND's revenue (10.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if LGND's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Ligand Pharmaceuticals performed over the past 5 years?

50.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: LGND has a large one-off gain of $814.8M impacting its September 30 2019 financial results.

Growing Profit Margin: LGND's current net profit margins are higher than last year (73.8%).


Past Earnings Growth Analysis

Earnings Trend: LGND's earnings have grown significantly by 50.8% per year over the past 5 years.

Accelerating Growth: LGND's earnings growth over the past year (232.3%) exceeds its 5-year average (50.8% per year).

Earnings vs Industry: LGND earnings growth over the past year (232.3%) exceeded the Biotechs industry 103.3%.


Return on Equity

High ROE: LGND's Return on Equity (69.9%) is considered outstanding.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Ligand Pharmaceuticals's financial position?


Financial Position Analysis

Short Term Liabilities: LGND's short term assets ($1.2B) exceed its short term liabilities ($35.7M).

Long Term Liabilities: LGND's short term assets ($1.2B) exceed its long term liabilities ($661.2M).


Debt to Equity History and Analysis

Debt Level: LGND's debt to equity ratio (74.2%) is considered high.

Reducing Debt: LGND's debt to equity ratio has reduced from 455.6% to 74.2% over the past 5 years.

Debt Coverage: LGND's debt is not well covered by operating cash flow (1.7%).

Interest Coverage: LGND's interest payments on its debt are not well covered by EBIT (1.9x coverage).


Balance Sheet

Inventory Level: LGND has a low level of unsold assets or inventory.

Debt Coverage by Assets: LGND's debt is covered by short term assets (assets are 1.9x debt).


Next Steps

Dividend

What is Ligand Pharmaceuticals's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.4%markettop25%3.7%industryaverage2.0%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate LGND's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate LGND's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if LGND's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if LGND's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of LGND's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

What is the CEO of Ligand Pharmaceuticals's salary, the management and board of directors tenure and is there insider trading?

4.9yrs

Average management tenure


CEO

John Higgins (49yo)

12.9yrs

Tenure

US$6,306,803

Compensation

Mr. John L. Higgins has been the Chief Executive Officer at Ligand Pharmaceuticals Incorporated since January 16, 2007. He serves as the President and Chief Executive Officer of Moonstone Acquisition, Inc. ...


CEO Compensation Analysis

Compensation vs Market: John's total compensation ($USD6.31M) is above average for companies of similar size in the US market ($USD3.89M).

Compensation vs Earnings: John's compensation has been consistent with company performance over the past year.


Management Age and Tenure

4.9yrs

Average Tenure

49yo

Average Age

Experienced Management: LGND's management team is considered experienced (4.9 years average tenure).


Board Age and Tenure

11.3yrs

Average Tenure

58yo

Average Age

Experienced Board: LGND's board of directors are seasoned and experienced ( 11.3 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUS$43,09103 Sep 19
Matthew Korenberg
EntityIndividual
Role
Chief Financial Officer
Executive VP of Finance & CFO
Shares500
Max PriceUS$86.18
BuyUS$93,59405 Aug 19
Todd Davis
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares1,000
Max PriceUS$93.59
BuyUS$95,98005 Aug 19
Sunil Patel
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares1,000
Max PriceUS$95.98
SellUS$386,39501 Aug 19
Stephen Sabba
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares4,091
Max PriceUS$94.45
BuyUS$176,58331 Jul 19
John Higgins
EntityIndividual
Role
Chief Executive Officer
CEO & Executive Director
Shares1,850
Max PriceUS$95.45
BuyUS$108,20231 May 19
John Higgins
EntityIndividual
Role
Chief Executive Officer
CEO & Executive Director
Shares1,000
Max PriceUS$108.20
BuyUS$283,75014 May 19
John Higgins
EntityIndividual
Role
Chief Executive Officer
CEO & Executive Director
Shares2,500
Max PriceUS$113.50
BuyUS$285,72515 Mar 19
John Higgins
EntityIndividual
Role
Chief Executive Officer
CEO & Executive Director
Shares2,500
Max PriceUS$114.29
BuyUS$22,72715 Mar 19
Jalaa Equities, L.P.
EntityCompany
Shares202
Max PriceUS$112.51

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • John Higgins (49yo)

    CEO & Executive Director

    • Tenure: 12.9yrs
    • Compensation: US$6.31m
  • Matt Foehr (46yo)

    President & COO

    • Tenure: 4.9yrs
    • Compensation: US$3.32m
  • Charles Berkman (50yo)

    Senior VP

    • Tenure: 12.7yrs
    • Compensation: US$1.74m
  • Vince Antle (50yo)

    Senior VP of Technical Operations - CAPTISOL

    • Tenure: 1.9yrs
  • Audrey Warfield-Graham

    Senior VP of Human Resources

    • Tenure: 12.9yrs
  • Keith Marschke

    Senior Vice President of Biology & Scientific Affairs

    • Tenure: 1.9yrs
  • Matt Korenberg (44yo)

    Executive VP of Finance & CFO

    • Tenure: 4.3yrs
    • Compensation: US$2.67m
  • Todd Pettingill

    Director of Corporate Development

    • Tenure: 0yrs
  • Patrick O'Brien

    Senior Vice President of Investor Relations

    • Tenure: 0yrs

Board Members

  • John Higgins (49yo)

    CEO & Executive Director

    • Tenure: 12.9yrs
    • Compensation: US$6.31m
  • John Kozarich (70yo)

    Independent Chairman

    • Tenure: 12.8yrs
    • Compensation: US$363.37k
  • Todd Davis (58yo)

    Independent Director

    • Tenure: 12.8yrs
    • Compensation: US$343.37k
  • John LaMattina (69yo)

    Independent Director

    • Tenure: 8.8yrs
    • Compensation: US$335.87k
  • Sunil Patel (47yo)

    Independent Director

    • Tenure: 9.2yrs
    • Compensation: US$338.37k
  • Stephen Sabba (60yo)

    Independent Director

    • Tenure: 11.3yrs
    • Compensation: US$353.37k
  • Jason Aryeh (51yo)

    Independent Director

    • Tenure: 13.3yrs
    • Compensation: US$345.87k
  • Shalendar Bhasin

    Scientific Advisor

    • Tenure: 0yrs
  • Sarah Boyce (47yo)

    Director

    • Tenure: 0.2yrs
  • Nancy Gray (59yo)

    Independent Director

    • Tenure: 2.3yrs
    • Compensation: US$338.37k

Company Information

Ligand Pharmaceuticals Incorporated's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Ligand Pharmaceuticals Incorporated
  • Ticker: LGND
  • Exchange: NasdaqGM
  • Founded: 1987
  • Industry: Biotechnology
  • Sector: Pharmaceuticals & Biotech
  • Market Cap: US$1.876b
  • Shares outstanding: 17.56m
  • Website: https://www.ligand.com

Number of Employees


Location

  • Ligand Pharmaceuticals Incorporated
  • 3911 Sorrento Valley Boulevard
  • Suite 110
  • San Diego
  • California
  • 92121
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
LGNDNasdaqGM (Nasdaq Global Market)YesCommon StockUSUSDNov 1994
LGDNDB (Deutsche Boerse AG)YesCommon StockDEEURNov 1994

Biography

Ligand Pharmaceuticals Incorporated, a biopharmaceutical company, focuses on developing and acquiring technologies that help pharmaceutical companies to discover and develop medicines worldwide. Its commer ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/12 23:37
End of Day Share Price2019/12/12 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.