Stifel Increases Price Target#

Stifel has raised its price target for Ligand Pharmaceuticals Inc. (NASDAQ:LGND) from $230 to $255, while maintaining a Buy rating on the stock. Currently, Ligand's shares are trading at $236.28, close to their 52-week high of $238.31, reflecting a significant 114% increase over the past year.

Acquisition of XOMA Corporation#

The increase in price target follows Ligand's acquisition of XOMA Corporation, a company that specializes in biotech royalties, for $39 per share in cash. This acquisition totals approximately $739 million and includes a contingent value right related to litigation. The deal is expected to close in the third quarter of 2026. By acquiring XOMA, Ligand is set to double its royalty portfolio, which includes revenue-generating assets from various commercial products.

Financial Guidance and Cash Flow#

In light of this acquisition, Ligand has raised its 2026 revenue guidance by $25 million, now estimating royalty revenues between $270 million and $310 million. Additionally, the company has adjusted its earnings per share (EPS) guidance upward by $0.50, projecting a range of $8.50 to $9.50, which aligns closely with analyst expectations of $9.49 per share for fiscal 2026. Ligand plans to fund the acquisition through cash and its credit line, anticipating an increase in cash flow to $300 million, which will support its annual capital deployment goals.

Recent Earnings Performance#

Ligand Pharmaceuticals recently reported strong fourth-quarter earnings for 2025, with an adjusted EPS of $2.02, surpassing analyst predictions of $1.49. The company also achieved revenue of $59.7 million, exceeding the forecast of $55.6 million. For the full year, Ligand's revenue reached $268 million, with core revenue contributing $240 million. Furthermore, Ligand will receive a 9% royalty on worldwide net sales of FILSPARI, which has been approved by the FDA for treating a specific kidney condition in patients aged eight and older.

Analyst Ratings#

In response to these positive developments, other analysts have also raised their price targets for Ligand Pharmaceuticals. Oppenheimer increased its target to $277 from $275, while H.C. Wainwright raised its target to $243 from $239, both maintaining favorable ratings on the stock. These updates reflect Ligand's strong financial performance and strategic growth in its royalty portfolio.