Zai Lab (NASDAQ:ZLAB) Shares Gap Up - Time to Buy?

Key Points

• Zai Lab shares jumped 3.1%, opening at $23.19 after previously closing at $22.04, with the latest price near $23.62.
• Analyst sentiment is generally positive: the stock has an average “Moderate Buy” rating and a consensus price target of $37.25, substantially above its trading price.
• The company remains unprofitable, reporting a quarterly loss of $0.50 per share, a negative 41.86% net margin, and analysts expect a full-year loss of $2.37 per share. An insider also recently sold shares, while hedge funds increased their holdings.

Shares of Zai Lab Limited Unsponsored ADR (NASDAQ:ZLAB - Get Free Report) gapped up prior to trading on Friday. The stock had previously closed at $22.04, but opened at $23.19. Zai Lab shares last traded at $23.6190, with a volume of 566,874 shares changing hands.

Analyst Upgrades and Downgrades

Several analysts have recently weighed in on the stock. Wall Street Zen upgraded shares of Zai Lab from a "sell" rating to a "hold" rating in a research report on Saturday, September 26th. Citigroup increased 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. Zacks Research upgraded shares of Zai Lab from a "strong sell" rating to a "hold" rating in a research note on Tuesday, July 7th. Cantor Fitzgerald reaffirmed an "overweight" rating on shares of Zai Lab in a report on Tuesday, October 6th. Finally, Weiss Ratings upgraded Zai Lab from a "sell (e+)" rating to a "sell (d-)" rating in a research note on Wednesday, July 29th. One investment analyst has rated the stock with a Strong Buy rating, four have assigned a Buy rating, one has assigned a Hold rating and one has given a Sell rating to the company. According to data from MarketBeat.com, the stock presently has an average rating of "Moderate Buy" and an average target price of $37.25.

Zai Lab Trading Up 3.1%

The stock has a fifty day moving average of $25.27 and a two-hundred day moving average of $21.77. The stock has a market capitalization of $2.59 billion, a price-to-earnings ratio of -13.27 and a beta of 0.73.

Zai Lab (NASDAQ:ZLAB - Get Free Report) last announced its earnings results on Tuesday, June 30th. The company reported ($0.50) EPS for the quarter. Zai Lab had a negative return on equity of 27.43% and a negative net margin of 41.86%. The business had revenue of $106.31 million for the quarter. Equities analysts expect that Zai Lab Limited Unsponsored ADR will post -2.37 earnings per share for the current year.

Insider Activity

In other news, Director William Lis sold 8,506 shares of the company's stock in a transaction that occurred on Wednesday, August 12th. The shares were sold at an average price of $25.00, for a total transaction of $212,650.00. Following the transaction, the director directly owned 41,931 shares in the company, valued at approximately $1,048,275. This represents a 16.86% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Insiders have sold 9,385 shares of company stock worth $235,145 in the last quarter. 4.88% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On Zai Lab

Large investors have recently made changes to their positions in the company. Nykredit A S acquired a new position in Zai Lab during the 2nd quarter valued at about $79,000. WealthPlan Investment Management LLC acquired a new stake in shares of Zai Lab during the 3rd quarter worth approximately $969,000. Headlands Technologies LLC raised its stake in shares of Zai Lab by 142.0% during the second quarter. Headlands Technologies LLC now owns 68,010 shares of the company's stock worth $1,292,000 after buying an additional 39,901 shares during the last quarter. Finally, Seven Fleet Capital Management LP raised its stake in shares of Zai Lab by 74.7% during the second quarter. Seven Fleet Capital Management LP now owns 136,016 shares of the company's stock worth $2,584,000 after buying an additional 58,158 shares during the last quarter. Institutional investors and hedge funds own 41.65% of the company's stock.

About Zai Lab

Zai Lab Ltd. NASDAQ: ZLAB is a biopharmaceutical company focused on discovering, developing and commercializing medicines for cancer and other serious diseases. Its research and development activities have included oncology, autoimmune and inflammatory disorders, neuroscience, infectious diseases and other areas of significant unmet medical need.

Founded in 2014, Zai Lab has built its business through a combination of internally developed programs and licensing or collaboration agreements with international pharmaceutical and biotechnology companies.

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