Why Ligand (LGND) Is Up 5.7% After Highlighting Royalty-Heavy 2026 Revenue Guidance

• Earlier in December 2025, Ligand Pharmaceuticals issued 2026 guidance calling for total revenue of US$245 million to US$285 million, including US$200 million to US$225 million in royalty revenue, US$35 million to US$40 million in Captisol sales, and US$10 million to US$20 million in contract revenue.
• This detailed breakdown highlights how reliant the company expects to be on high-margin royalty income, with smaller contributions from Captisol and contract work.
• Next, we’ll examine how this new 2026 revenue breakdown, especially the emphasis on royalty income, affects Ligand’s investment narrative.

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Ligand Pharmaceuticals Investment Narrative Recap

To own Ligand Pharmaceuticals, you need to be comfortable with a business model built around high-margin royalties from partnered drugs, supplemented by Captisol and contract revenue. The new 2026 guidance reinforces this reliance on royalty income and does not materially change the near term catalyst of how quickly key partnered assets scale, nor the central risk that concentration in a handful of programs can swing results.

The updated 2025 guidance from November, which lifted expected royalty and contract revenue, sets an important reference point for the new 2026 outlook. Together, they frame a business that increasingly leans on recurring royalties, while Captisol and contract work help smooth quarter to quarter volatility but are less central to the long term story.

However, investors should also be aware that over reliance on a concentrated set of royalty assets means...

Read the full narrative on Ligand Pharmaceuticals (it's free!)

Ligand Pharmaceuticals' narrative projects $315.6 million revenue and $121.1 million earnings by 2028. This requires 18.9% yearly revenue growth and a $197 million earnings increase from -$75.9 million today.

Uncover how Ligand Pharmaceuticals' forecasts yield a $237.50 fair value, a 19% upside to its current price.

Exploring Other Perspectives

Three fair value estimates from the Simply Wall St Community span roughly US$39 to US$238 per share, highlighting how far apart individual views can be. When you set that against Ligand’s growing tilt toward royalty income as outlined in its 2026 guidance, it underlines why exploring several independent viewpoints on the durability of those royalties can be so important.

Explore 3 other fair value estimates on Ligand Pharmaceuticals - why the stock might be worth as much as 19% more than the current price!

Build Your Own Ligand Pharmaceuticals Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Ligand Pharmaceuticals research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision.
• Our free Ligand Pharmaceuticals research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Ligand Pharmaceuticals' overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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