Viking Therapeutics (VKTX): Assessing Valuation as VK2735 Advances Through Late-Stage Obesity Drug Trials

Viking Therapeutics (VKTX) is moving forward with its dual GIP/GLP-1 receptor agonist, VK2735. The injectable form is now in phase 3 and the oral version is in phase 2, drawing attention from both investors and larger pharmaceutical companies.

See our latest analysis for Viking Therapeutics.

Excitement around Viking’s phase 3 weight-loss drug trials and talk of big pharma interest have injected serious momentum into the share price recently, with a 45.8% gain over the past month. However, the 1-year total shareholder return remains deep in negative territory. The stock’s massive 889% three-year total return shows why investors are watching for signs of a sustainable turnaround.

If innovation in obesity treatments has you on the lookout for new opportunities, consider browsing See the full list for free. for more companies making waves in the healthcare sector.

With the rapid run-up in Viking’s share price and mounting anticipation for a blockbuster weight loss treatment, is there room for further upside? Or has the market already priced in all signs of future growth?

Price-to-Book Ratio of 5x: Is it justified?

Viking Therapeutics currently trades on a price-to-book ratio of 5x, presenting a noticeably different valuation compared to its sector peers. At a last close of $35.12, this multiple signals a significant valuation premium and prompts questions about how the market is weighing future potential.

The price-to-book ratio compares the market value of the company to its book value and is often used for biotech stocks that have volatile or negative earnings. In the case of Viking, this metric is relevant given its unprofitable status and primarily asset-driven value proposition.

While Viking's price-to-book ratio of 5x appears reasonable compared to the peer average of 12x, it is considered expensive when measured against the broader US Biotechs industry average of 2.6x. This suggests that, despite peer-relative value, the broader market may remain skeptical of Viking's near-term profitability. There is currently insufficient data to determine what a "fair" price-to-book ratio should be for Viking, so the market's premium appears to rest on expectations for future success rather than proven profitability.

See what the numbers say about this price — find out in our valuation breakdown.

Result: Price-to-Book Ratio of 5x (ABOUT RIGHT)

However, setbacks in clinical trials or delays in regulatory approval could quickly reverse optimism and impact Viking's outlook.

Find out about the key risks to this Viking Therapeutics narrative.

Build Your Own Viking Therapeutics Narrative

If you are interested in drawing your own conclusions or prefer hands-on analysis, it is easy to dive into the numbers and shape your own view in just a few minutes. Do it your way.

A great starting point for your Viking Therapeutics research is our analysis highlighting 1 key reward and 4 important warning signs that could impact your investment decision.

Looking for more investment ideas?

Smart investors never stop evolving their strategy. Seize your chance to uncover opportunities the crowd overlooks by searching for promising stocks in new categories today.

• Boost your potential returns by targeting untapped growth opportunities with these 3571 penny stocks with strong financials, which combine solid fundamentals with breakout momentum.
• Capture the future of healthcare by checking out these 33 healthcare AI stocks, harnessing AI innovation to transform patient care and deliver high-impact results.
• Strengthen your portfolio’s income stream by tapping into these 18 dividend stocks with yields > 3%, offering reliable yields above 3% for long-term stability.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com