Buy the story, sell the news. That’s a reasonable explanation for why Viking Therapeutics (NASDAQ: VKTX) fell over 3% the day the company delivered its Q1 2026 earnings report.
For investors who may not be familiar with Viking Therapeutics, it’s important to understand that the company is not profitable and it’s still in the pre-revenue stage. So, evaluating the earnings report on the headline numbers doesn’t work. Instead, because it’s a biotechnology company, investors will want to pay attention to where the company is in its FDA timeline to assess the risk and reward. The FDA process takes time, and that’s presenting investors with the possibility of a sizable long-term reward if they’re comfortable with near-term risk.
Defining the Opportunity
Viking Therapeutics is a relatively new player in the GLP-1 space. The market is currently dominated by Eli Lilly (NYSE: LLY) and Novo Nordisk (NYSE: NVO). However, both companies are dealing with the challenge of scaling production to meet demand.
It's a good problem to have, but it’s one that leaves the door open for a company like Viking. That’s why investors are buying the story.
Rather than being just another entrant into the GLP-1 space, Viking is taking a two-track approach that has the potential to set it apart from its competitors. This means having both an injectable (subcutaneous) and oral version of the drug moving through clinical trials.
Progress Takes Time
Currently, the injectable drug (VK2735) is further along in the process. The injectable formulation's Phase 2 (VENTURE) trial was completed in 2025 and published in the peer-reviewed journal Obesity in January 2026.
Viking has since reported that it has fully enrolled patients in the VANQUISH-1 (covering adults with obesity) and VANQUISH-2 trials (covering adults with obesity and type 2 diabetes). These are 78-week trials, so investors shouldn’t expect results until the second half of 2027 at the earliest.
But Viking is also making progress on the oral version of VK2735. Viking completed an end-of-Phase 2 meeting with the FDA in December 2025 for the oral formulation, and based on the agency's feedback, the company plans to advance oral VK2735 into Phase 3. That’s not expected until Q4 2026, which puts it about six months behind the injectable version.
The other problem with the time lag is that Viking doesn’t have the field to itself. Companies like Lilly already have oral pills in the market, and that could limit the addressable market even if the company gets approved.
Progress Takes Money
If successful, Viking will be able to enter the GLP-1 arena with two options, including an oral version that consumers have shown a preference for. But Viking will have to burn money to get the drugs through the clinical trials.
To that end, Viking ended the quarter with approximately $603 million. The company believes that amount is sufficient to get it into 2028. That should get the injectable form of VK2735 through the clinical trial phase. To help mitigate execution risk, Viking has signed a comprehensive agreement with CordenPharma.
However, the company did burn more cash than expected in the quarter, which may explain the selloff. If the company is short of cash, it will have to raise cash, likely through a share offering that would be dilutive to shareholders.
The Wildcard That Could Redefine the Opportunity
In addition to VK2735, Viking has also filed an investigational new drug (IND) application for its VK3019 candidate. This is a novel amylin agonist therapeutic that targets the amylin and calcitonin receptors that play an important role in regulating food intake and metabolic control.
Viking believes that dual activation of the amylin and calcitonin receptors could represent an attractive treatment option for patients who aren’t candidates for GLP-1 therapeutics. The company plans to initiate a Phase 1 trial in Q2 2026.
How to Make Time Your Friend With VKTX
Right now, short interest on VKTX is around 21%, and with 76% institutional ownership, that’s a headwind for retail investors. That’s evident with VKTX being down over 14% in 2026 despite the encouraging progress.
However, despite being a clinical-stage company, Viking has 13 analysts that cover it and give the stock a consensus price target of $95.50. That’s a potential return of over 200%.
But with short-term volatility in place, this could be a time for investors to scale in over time. Using dollar cost averaging or initiating a starting position and adding tranches based on the successful completion of milestones can help mitigate the risk while still capturing upside.
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The article "Viking Therapeutics Faces Timeline Risk—But Upside Could Be Huge" first appeared on MarketBeat.
