2024-04-16 17:08:09 ET
Summary
- Zai Lab offers a weaker value proposition for investors looking to bet on Chinese biotech due to its pure license in approach, limiting its potential to tap into global market.
- Its key products have shown a slow-down in 2023 and is facing increased competition.
- There is limited excitement in the current pipeline, as competitors have already taken the lead in the development timeline.
- The company is overvalued because it is trading at a similar P/S ratio to its peers, even though it has weaker quality in several key aspects.
Investment Thesis
I initiate coverage of Zai Lab with a Sell rating due to its slower revenue growth compared to peers, increasing competition for its key products, and a weak drug pipeline....
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A Risky Bet: Zai Lab's Uncertain Future