Madrigal Pharmaceuticals (NASDAQ:MDGL) Shares Gap Up After Better-Than-Expected Earnings

Key Points

• Madrigal Pharmaceuticals shares surged in pre-market trading, opening at $350.00 after an earnings report that beat expectations, with a reported EPS of ($1.90) compared to a consensus estimate of ($3.64).
• Analysts have raised their price targets on Madrigal, with JMP Securities setting a target of $443.00, while Canaccord Genuity and B. Riley have target prices of $420.00 and $460.00, respectively.
• Insider transactions showed significant selling activity as directors sold shares at an average price of $353.47, indicating a decrease in their holdings by over 5%.

Madrigal Pharmaceuticals, Inc. (NASDAQ:MDGL - Get Free Report)'s stock price gapped up prior to trading on Tuesday following a better than expected earnings announcement. The stock had previously closed at $312.11, but opened at $350.00. Madrigal Pharmaceuticals shares last traded at $330.70, with a volume of 156,412 shares trading hands.

The biopharmaceutical company reported ($1.90) earnings per share for the quarter, topping analysts' consensus estimates of ($3.48) by $1.58. The firm had revenue of $212.80 million during the quarter, compared to analysts' expectations of $158.94 million. Madrigal Pharmaceuticals had a negative net margin of 54.68% and a negative return on equity of 38.38%. Madrigal Pharmaceuticals's quarterly revenue was up 1357.5% compared to the same quarter last year. During the same quarter in the prior year, the business earned ($7.10) EPS.

Wall Street Analyst Weigh In

MDGL has been the subject of several recent research reports. Canaccord Genuity Group raised their target price on shares of Madrigal Pharmaceuticals from $420.00 to $428.00 and gave the company a "buy" rating in a report on Wednesday. UBS Group raised their target price on shares of Madrigal Pharmaceuticals from $441.00 to $458.00 and gave the company a "buy" rating in a report on Friday, May 2nd. JMP Securities restated a "market outperform" rating and set a $443.00 target price on shares of Madrigal Pharmaceuticals in a report on Thursday, April 24th. Wall Street Zen upgraded shares of Madrigal Pharmaceuticals from a "sell" rating to a "hold" rating in a report on Monday, May 5th. Finally, B. Riley reiterated a "buy" rating and set a $460.00 price target (up from $422.00) on shares of Madrigal Pharmaceuticals in a report on Friday, May 2nd. Two investment analysts have rated the stock with a hold rating and seven have assigned a buy rating to the company. Based on data from MarketBeat.com, the stock has an average rating of "Moderate Buy" and an average price target of $430.43.

Insider Activity

In other Madrigal Pharmaceuticals news, Director Paul A. Friedman sold 1,400 shares of the company's stock in a transaction dated Friday, July 18th. The shares were sold at an average price of $350.03, for a total value of $490,042.00. Following the completion of the sale, the director directly owned 187,164 shares of the company's stock, valued at approximately $65,513,014.92. This represents a 0.74% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, Director Rebecca Taub sold 1,000 shares of the company's stock in a transaction dated Friday, July 18th. The shares were sold at an average price of $350.00, for a total transaction of $350,000.00. Following the sale, the director directly owned 461,044 shares of the company's stock, valued at $161,365,400. This represents a 0.22% decrease in their ownership of the stock. The disclosure for this sale can be found here. Insiders sold 60,377 shares of company stock valued at $21,316,969 in the last ninety days. Corporate insiders own 21.50% of the company's stock.

Institutional Trading of Madrigal Pharmaceuticals

A number of hedge funds have recently bought and sold shares of the company. LPL Financial LLC increased its holdings in shares of Madrigal Pharmaceuticals by 10.1% in the 4th quarter. LPL Financial LLC now owns 5,220 shares of the biopharmaceutical company's stock valued at $1,611,000 after purchasing an additional 480 shares during the period. Franklin Resources Inc. increased its holdings in shares of Madrigal Pharmaceuticals by 340.1% in the 4th quarter. Franklin Resources Inc. now owns 6,087 shares of the biopharmaceutical company's stock valued at $1,878,000 after purchasing an additional 4,704 shares during the period. Wells Fargo & Company MN increased its holdings in shares of Madrigal Pharmaceuticals by 19.1% in the 4th quarter. Wells Fargo & Company MN now owns 34,923 shares of the biopharmaceutical company's stock valued at $10,776,000 after purchasing an additional 5,604 shares during the period. Envestnet Asset Management Inc. increased its holdings in Madrigal Pharmaceuticals by 2.3% in the fourth quarter. Envestnet Asset Management Inc. now owns 15,001 shares of the biopharmaceutical company's stock worth $4,629,000 after buying an additional 334 shares during the last quarter. Finally, Russell Investments Group Ltd. increased its holdings in Madrigal Pharmaceuticals by 120.2% in the fourth quarter. Russell Investments Group Ltd. now owns 1,482 shares of the biopharmaceutical company's stock worth $457,000 after buying an additional 809 shares during the last quarter. 98.50% of the stock is owned by hedge funds and other institutional investors.

Madrigal Pharmaceuticals Stock Up 1.0%

The company has a debt-to-equity ratio of 0.17, a current ratio of 5.11 and a quick ratio of 5.58. The business has a fifty day moving average of $301.66 and a 200 day moving average of $313.10. The stock has a market cap of $7.68 billion, a price-to-earnings ratio of -26.91 and a beta of -1.02.

About Madrigal Pharmaceuticals

Madrigal Pharmaceuticals, Inc, a clinical-stage biopharmaceutical company, focuses on the development of therapeutics for the treatment of non-alcoholic steatohepatitis (NASH) in the United States. Its lead product candidate is resmetirom, a liver-directed thyroid hormone receptor beta agonist, which is in Phase 3 clinical trials for treating NASH.