Zai Lab (NASDAQ:ZLAB) Shares Down 4.6% - Here's What Happened

Key Points

• Zai Lab shares fell 4.6% to about $25.77 in midday trading, with trading volume down 92% from the stock’s average daily level.
• Analysts maintain a generally positive outlook, with a consensus “Moderate Buy” rating and an average price target of $37.25, despite mixed individual rating changes.
• The company reported a quarterly loss of $0.50 per share on $106.31 million in revenue, while insiders sold shares primarily to cover tax obligations; institutional investors own 41.65% of the stock.

Zai Lab Limited Unsponsored ADR (NASDAQ:ZLAB - Get Free Report)'s share price dropped 4.6% during mid-day trading on Friday . The company traded as low as $25.61 and last traded at $25.7690. Approximately 66,963 shares changed hands during mid-day trading, a decline of 92% from the average daily volume of 858,776 shares. The stock had previously closed at $27.00.

Analysts Set New Price Targets

A number of equities analysts recently commented on the stock. Citigroup raised their price target on shares of Zai Lab from $44.00 to $45.00 and gave the stock a "buy" rating in a research report on Friday, August 7th. Wall Street Zen lowered shares of Zai Lab from a "hold" rating to a "sell" rating in a research report on Saturday, May 16th. Weiss Ratings raised shares of Zai Lab from a "sell (e+)" rating to a "sell (d-)" rating in a report on Wednesday, July 29th. Finally, Zacks Research upgraded shares of Zai Lab from a "strong sell" rating to a "hold" rating in a research report on Tuesday, July 7th. One investment analyst has rated the stock with a Strong Buy rating, four have issued a Buy rating, one has given a Hold rating and one has issued a Sell rating to the company. Based on data from MarketBeat, the company presently has a consensus rating of "Moderate Buy" and an average price target of $37.25.

Zai Lab Stock Down 4.0%

The firm has a market cap of $2.95 billion, a price-to-earnings ratio of -15.14 and a beta of 0.83. The stock has a 50 day moving average of $21.91 and a 200 day moving average of $20.32.

Zai Lab (NASDAQ:ZLAB - Get Free Report) last announced its quarterly earnings data on Tuesday, June 30th. The company reported ($0.50) earnings per share (EPS) for the quarter. Zai Lab had a negative return on equity of 27.43% and a negative net margin of 41.86%.The firm had revenue of $106.31 million for the quarter. As a group, analysts predict that Zai Lab Limited Unsponsored ADR will post -2.17 EPS for the current fiscal year.

Insider Buying and Selling

In related news, CFO Yajing Chen sold 2,264 shares of the stock in a transaction that occurred on Friday, June 26th. The shares were sold at an average price of $17.46, for a total value of $39,529.44. Following the completion of the transaction, the chief financial officer owned 35,691 shares of the company's stock, valued at $623,164.86. This represents a 5.96% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CEO Ying Du sold 7,026 shares of the business's stock in a transaction on Tuesday, June 30th. The stock was sold at an average price of $18.53, for a total transaction of $130,191.78. Following the completion of the sale, the chief executive officer directly owned 1,203,784 shares in the company, valued at approximately $22,306,117.52. This represents a 0.58% decrease in their position. The SEC filing for this sale provides additional information. The sale was made to cover tax withholding obligations related to the vesting of equity awards. In the last 90 days, insiders have sold 50,258 shares of company stock worth $960,741. Corporate insiders own 4.88% of the company's stock.

Institutional Investors Weigh In On Zai Lab

A number of institutional investors have recently modified their holdings of the company. Royal Bank of Canada raised its stake in Zai Lab by 214.3% during the first quarter. Royal Bank of Canada now owns 13,771 shares of the company's stock worth $498,000 after buying an additional 9,390 shares during the last quarter. Headlands Technologies LLC boosted its position in shares of Zai Lab by 142.0% during the 2nd quarter. Headlands Technologies LLC now owns 68,010 shares of the company's stock valued at $1,292,000 after purchasing an additional 39,901 shares in the last quarter. Finally, Seven Fleet Capital Management LP boosted its position in shares of Zai Lab by 74.7% during the 2nd quarter. Seven Fleet Capital Management LP now owns 136,016 shares of the company's stock valued at $2,584,000 after purchasing an additional 58,158 shares in the last quarter. 41.65% of the stock is owned by institutional investors.

Zai Lab Company Profile

Zai Lab Ltd NASDAQ: ZLAB is a biopharmaceutical company focused on the research, development, manufacturing and commercialization of innovative therapies. Headquartered in Shanghai, China, Zai Lab operates R&D centers in Asia and the United States and maintains commercial offices across Greater China, North America, Europe and Australia. The company's end-to-end platform encompasses discovery biology, translational development, clinical research and global supply chain management.

The company's marketed portfolio is anchored by Brukinsa (zanubrutinib), a next-generation Bruton's tyrosine kinase inhibitor approved for several B-cell malignancies.

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