BTIG reiterates buy rating on Viking Therapeutics stock amid obesity trials

Viking Therapeutics (VKTX) has initiated two Phase 3 obesity trials, VANQUISH-1 and VANQUISH-2, for its weekly subcutaneous injection VK2735, evaluating its efficacy for weight loss in obese and overweight patient populations over 78 weeks. This move prompted BTIG to reiterate its Buy rating and $125 price target, implying substantial upside from the current $26.82, with other analysts also maintaining positive outlooks. Despite reporting a wider Q1 2025 net loss, the company retains a strong $852 million cash position and is also advancing an oral VK2735 formulation, with VENTURE study data anticipated in H2 2025, signaling a comprehensive strategy for the expanding obesity treatment market.

Analysis

Viking Therapeutics (VKTX) has materially advanced its position in the competitive obesity drug market by initiating two pivotal Phase 3 trials, VANQUISH-1 and VANQUISH-2, for its lead candidate, VK2735. This move prompted a strong reaffirmation from BTIG, which reiterated its Buy rating and a $125 price target, suggesting substantial upside from the current trading price of $26.82. The company's financial health appears robust for a clinical-stage entity, with a reported cash position of $852 million and an exceptionally high current ratio of 44.25, indicating it is well-capitalized to fund these extensive trials. While the company reported a wider-than-expected net loss of $0.41 per share for Q1 2025, this is offset by strong operational execution, including a secured manufacturing agreement with CordenPharma. The strategic pursuit of both subcutaneous and oral formulations of VK2735, with data from the oral VENTURE study expected in H2 2025, positions Viking to capture a broader segment of the market, a potential highlighted by positive ratings from multiple analyst firms.

Key Decisions for Investors

• Given the initiation of pivotal Phase 3 trials and strong analyst support suggesting significant upside, investors with a high risk tolerance could view the current valuation as an attractive entry point for long-term exposure to the obesity treatment market.
• Investors should monitor the company's cash burn rate in subsequent quarters, as the cost of running two large Phase 3 trials will be substantial, despite the current strong cash position.
• The upcoming data from the oral VK2735 VENTURE study in H2 2025 represents a major potential catalyst, and its outcome will be critical in assessing the drug's full market potential against competitors.