Zai Lab (NASDAQ:ZLAB) Stock Price Up 7% - Still a Buy?

Key Points

• Zai Lab shares rose 7% on Wednesday, trading as high as $20.53 after closing at $19.30, though volume was below average.
• Analysts remain cautiously positive: the stock has a consensus rating of “Moderate Buy” with an average price target of $40.00, even as some firms recently cut targets or downgraded ratings.
• The company is still unprofitable, posting a quarterly loss of $0.50 per share on $99.61 million in revenue, while insiders have been selling shares to cover tax withholding obligations.

Shares of Zai Lab Limited Unsponsored ADR (NASDAQ:ZLAB - Get Free Report) traded up 7% during trading on Wednesday . The stock traded as high as $20.53 and last traded at $20.66. 406,055 shares changed hands during trading, a decline of 50% from the average session volume of 819,092 shares. The stock had previously closed at $19.30.

Analyst Ratings Changes

A number of research firms have recently weighed in on ZLAB. Weiss Ratings upgraded shares of Zai Lab from a "sell (e+)" rating to a "sell (d-)" rating in a report on Friday, June 26th. Citigroup dropped their price target on Zai Lab from $47.00 to $44.00 and set a "buy" rating for the company in a research report on Friday, May 8th. Zacks Research raised Zai Lab from a "strong sell" rating to a "hold" rating in a research note on Tuesday, July 7th. Wall Street Zen downgraded Zai Lab from a "hold" rating to a "sell" rating in a research report on Saturday, May 16th. Finally, JPMorgan Chase & Co. lowered their price objective on Zai Lab from $39.00 to $32.00 and set an "overweight" rating for the company in a research note on Wednesday, March 18th. One research analyst has rated the stock with a Strong Buy rating, four have assigned a Buy rating, one has given a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat.com, the stock has an average rating of "Moderate Buy" and a consensus target price of $40.00.

Zai Lab Price Performance

The firm has a market cap of $2.33 billion, a P/E ratio of -12.63 and a beta of 0.76. The stock's 50-day simple moving average is $18.60 and its two-hundred day simple moving average is $19.09.

Zai Lab (NASDAQ:ZLAB - Get Free Report) last released its earnings results on Wednesday, April 1st. The company reported ($0.50) earnings per share (EPS) for the quarter. Zai Lab had a negative return on equity of 24.32% and a negative net margin of 39.29%.The firm had revenue of $99.61 million during the quarter. As a group, sell-side analysts expect that Zai Lab Limited Unsponsored ADR will post -2.23 earnings per share for the current year.

Insiders Place Their Bets

In other Zai Lab news, CFO Yajing Chen sold 2,264 shares of the firm's stock in a transaction dated 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 sale, the chief financial officer owned 35,691 shares of the company's stock, valued at $623,164.86. This trade represents a 5.96% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this hyperlink. 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 that occurred on Tuesday, June 30th. The shares were sold at an average price of $18.53, for a total value of $130,191.78. Following the transaction, the chief executive officer owned 1,203,784 shares of the company's stock, valued at $22,306,117.52. This trade represents a 0.58% decrease in their position. The disclosure for this sale is available in the SEC filing. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders sold a total of 90,873 shares of company stock valued at $1,730,096 over the last 90 days. Insiders own 4.88% of the company's stock.

Hedge Funds Weigh In On Zai Lab

An institutional investor recently raised its stake in Zai Lab stock. SG Americas Securities LLC grew its holdings in Zai Lab Limited Unsponsored ADR (NASDAQ:ZLAB - Free Report) by 6.6% during the fourth quarter, according to the company in its most recent disclosure with the Securities & Exchange Commission. The firm owned 10,396 shares of the company's stock after purchasing an additional 642 shares during the period. SG Americas Securities LLC's holdings in Zai Lab were worth $183,000 as of its most recent filing with the Securities & Exchange Commission. 41.65% of the stock is owned by institutional investors and hedge funds.

About Zai Lab

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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