1. Viking Therapeutics, Inc. (NASDAQ:VKTX)
Year-to-Date Performance as of September 14: 265.04%
Short % of Shares Outstanding as of September 14: 15.5%
Number of Hedge Fund Holders: 50
Viking Therapeutics, Inc. (NASDAQ:VKTX) is another biotech company on our list. It develops novel therapies for metabolic and endocrine disorders.
Despite what short sellers may have you think, Viking Therapeutics, Inc. (NASDAQ:VKTX) is a biotech company with immense growth potential. Currently, the company has an investigational obesity drug in trials. If the drug succeeds, it could offer robust competition to major pharmaceutical companies such as Novo Nordisk and Eli Lilly, especially since Viking Therapeutics, Inc.’s (NASDAQ:VKTX) drug is administered orally – which makes it easier to take than Novo Nordisk’s Wegovy and Eli Lilly’s Zepbound.
Viking Therapeutics, Inc. (NASDAQ:VKTX) also has a strong balance sheet, reporting over $900 million in case in the second quarter. This highlights the company’s ability to keep up with all of its pipeline programs. However, seeing as the company is still far behind other pharma companies, it has been seeing greater losses. In the second quarter, for instance, Viking Therapeutics, Inc. (NASDAQ:VKTX) reported a net loss of $49.6 million. In spite of all this, many investors and hedge funds continue to stick with this stock because of the immense potential it has to grow and challenge big pharma players in the market.
We saw 50 hedge funds long Viking Therapeutics, Inc. (NASDAQ:VKTX) in the second quarter, with a total stake value of $479.1 million.
Fred Alger Management mentioned Viking Therapeutics, Inc. (NASDAQ:VKTX) in its second-quarter 2024 investor letter:
“Viking Therapeutics, Inc. (NASDAQ:VKTX) is a clinical-stage biopharmaceutical company focused on developing novel therapies for patients suffering from metabolic and endocrine disorders. Their lead drug VK2809, a beta-selective thyroid hormone receptor agonist, is in development for nonalcoholic steatohepatitis and nonalcoholic fatty liver disease. Their VK2735 drug is a GLP-1 dual agonist being developed for patients with obesity. During the quarter, the company’s shares were negatively impacted by several factors: 1) a challenging environment for biotechnology stocks, exacerbated by Fed policy decisions to maintain elevated interest rates, 2) increased competition in the obesity treatment landscape, 3) manufacturability and scalability concerns regarding Viking’s obesity drug and 4) the absence of strategic partnerships from large pharmaceutical companies. Despite the challenging quarter, we continue to believe that the company’s GLP-1 drug has the potential to be a best-in-class obesity drug given its favorable efficacy and safety profile. Further, with approximately one-third of U.S. adults suffering from obesity, we believe the company’s GLP[1]1 drug has the potential to address a large market once approved.”
While biotech players like VKTX may be lucrative investments, we believe that AI stocks hold promise for delivering high returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than the ones mentioned in our list but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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