Volume Spikes Followed By PreMarket Pullback For Viking Therateutics (VKTX) – Analysts Like It

Viking Therapeutics stock (NASDAQ: VKTX) has been one of 2024's best performing on the Nasdaq, with gains of 264.5% building the company a bit of a following. There are many drivers, but one that has boded well for various stocks is if gains are supported by volume.

In a notable development on the trading floor, Viking Therapeutics has delivered just that, with a significant surge on both the stock, and options chain. The volume of VKTX shares changing hands yesterday was more than double the average daily level at 8million (vs 3.86 million ADV). Traders also acquired more than 35,000 call options for the company's stock, also more than a 100% increase compared to the typical daily average.

Price action on the day led VKTX to gains of 17.49% as the stock looked to break out of the 3 month trading range. In this morning's pre-market, there is somewhat of a pullback from Monday's bullishness, with the stock down a little over 6%. So why the spike yesterday?

Analysts have taken a positive stance on the biopharmaceutical company, bestowing a mix of “buy” and “strong-buy” ratings but an upgrade has also boosted sentiment. Raymond James have boosted their already bullish target of $116, to a new mark of $118 with their Strong Buy rating reaffirmed.

The firm noted Q2 earnings positivity along with the pipeline of treatments coming through at Viking.

• VK2735 advancing directly to Phase 3
• Phase 1 study of oral VK2735 advanced through 60mg and 80mg cohorts
• Phase 1 oral VK2735 data abstract was submitted to ObesityWeek

Ownership of Viking Therapeutics is predominantly institutional, with hedge funds and institutional investors jointly holding approximately 76.03% of the company’s stock. This statistic underscores a strong institutional confidence in the company's future prospects.

The market capitalisation for Viking Therapeutics currently stands at $7.35 billion. The share price has experienced significant volatility over the past year, hitting a 12-month low of $8.28 and reaching a high of $99.41.

On the financial front, Viking Therapeutics reported quarterly earnings of ($0.20) per share, surpassing the consensus estimates of market analysts, with forecasts for the year predicting the company to post -$0.99 earnings per share.

Viking Therapeutics specializes in developing innovative therapies aimed at addressing metabolic and endocrine disorders. Their flagship drug candidate, VK2809, is currently in Phase IIb clinical trials, targeting conditions such as non-alcoholic steatohepatitis (NASH) and non-alcoholic fatty liver disease (NAFLD).

The recent activity within the options market, combined with the robust ratings from research firms and significant insider transactions, paints a dynamic picture of Viking Therapeutics in the biopharmaceutical industry. With a firm foot in clinical development and a clear plan for advancing their lead drug candidate, investors and market spectators alike will be keeping a close eye on VKTX's performance in the coming periods.