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LGND, Ligand Pharmaceuticals

Pharmaceuticals consumer brand Cyclical

We are a biopharmaceutical royalty company focused on deploying capital and licensing technologies to acquire and create diversified royalty streams from high-value medicines.

Our primary business is investing in and structuring royalty interests in mid- to late-stage development and commercial biopharmaceutical products, allowing us to generate long-duration, non-dilutive cash flows supported by a lean corporate cost structure.

Capital deployment and technology licensing are the primary drivers of our long-term growth.

Latest annual: FY2025 10-K

LGND · Ligand Pharmaceuticals

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2025

$268M

+60.4% YoY · 10% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $274M 5-yr avg $201M

Operating margin 34.5% 5-yr avg 11.1%

ROIC 6% 5-yr avg 1%

Owner-earnings margin 45% 5-yr avg 40%

Free cash flow margin 45% 5-yr avg 40%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

Situation: Cyclical. Margins collapse and recover repeatedly across the record; a single year, good or bad, misstates the through-cycle earning power.
What moves the needle: Gross margin has run about 96% and operating margin about 23% through the cycle, a wide spread between price and the cost of what it sells — whether that advantage is durable pricing power or a margin that can erode is the question the record is for. The operating margin has swung widely — from −14% to 671% over the years — so the through-cycle figure carries more than any single year, and the worst year more than the best. Stock-based pay runs about 18% of sales, a real and recurring claim on owners that the GAAP margin understates. Read this kind of business on the pipeline against the patent cliff, and pricing. On its own account, the filing leans hardest on pricing power & competition, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on capital has rarely cleared the cost of capital (median 2%, above 15% in 1 of 7 years). By owner earnings: roughly 45% of revenue reaches owners as cash, consistently. The cycle and the balance sheet decide this one; the worst year tells more than the median, and the rest is in the 10-K.

Every line is arithmetic on the company's filings, shown in full in the sections below.

The record

Ten years of arithmetic, read across the cycle.

The record, 2016–2025

realized figures from each filing · older years to the left

2016’16	2017’17	2018’18	2019’19	2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMMar 2026
											Income statement
$109M	$141M	$251M	$120M	$164M	$242M	$196M	$131M	$167M	$268M	$274M	RevenueRevenue
95%	96%	97%	—	—	—	—	—	—	—	95%	Gross marginGross mgn
25%	20%	15%	35%	37%	19%	36%	40%	47%	34%	34%	SG&A / revenueSG&A/rev
19%	19%	11%	46%	25%	13%	18%	19%	13%	30%	12%	R&D / revenueR&D/rev
$44M	$68M	$164M	$807M	$38M	$104M	$3M	$12M	($23M)	$41M	$95M	Operating incomeOp. inc.
40.3%	48.2%	65.1%	671.0%	22.9%	43.0%	1.5%	9.1%	−13.5%	15.3%	34.5%	Operating marginOp. mgn
($2M)	$13M	$143M	$629M	($3M)	$57M	($33M)	$52M	($4M)	$124M	$154M	Net incomeNet inc.
—	—	17%	21%	—	-8%	—	16%	—	22%	17%	Effective tax rateTax rate
											Cash flow & returns
$61M	$89M	$194M	($29M)	$55M	$79M	$138M	$50M	$97M	$49M	$123M	Operating cash flowOp. cash
$11M	$11M	$13M	$18M	$26M	$51M	$52M	$37M	$35M	$34M	$33M	DepreciationDeprec.
$32M	$40M	$17M	($702M)	$1M	($68M)	$59M	($65M)	$25M	($156M)	($113M)	Working capital & otherWC & other
$2M	$2M	$887K	$3M	$4M	$9M	$18M	$4M	$2M	$452K	$466K	CapexCapex
1.7%	1.5%	0.4%	2.1%	2.7%	3.6%	9.1%	2.7%	1.1%	0.2%	0.2%	Capex / revenueCapex/rev
$59M	$86M	$193M	($32M)	$50M	$70M	$120M	$46M	$95M	$49M	$123M	Owner earningsOwner earn.
54.0%	61.2%	76.8%	−26.5%	30.6%	29.0%	61.1%	35.1%	57.0%	18.2%	44.8%	Owner earnings marginOE mgn
$59M	$86M	$193M	($32M)	$50M	$70M	$120M	$46M	$95M	$49M	$123M	Free cash flowFCF
54.0%	61.2%	76.8%	−26.5%	30.6%	29.0%	61.1%	35.1%	57.0%	18.2%	44.8%	Free cash flow marginFCF mgn
$93M	$27M	$6M	$12M	$405M	$0	$0	$10M	$0	$0	$0	AcquisitionsAcquis.
$4M	$2M	$123M	$453M	$78M	$0	$0	$0	$0	$15M	—	BuybacksBuybacks
—	9%	13%	48%	—	—	0%	1%	-1%	2%	6%	ROICROIC
-0%	3%	26%	82%	-0%	7%	-6%	7%	-0%	12%	15%	Return on equityROE
−0%	3%	26%	82%	−0%	7%	−6%	7%	−0%	12%	15%	Retained to equityRetained/eq
											Balance sheet
$141M	$202M	$718M	$1.1B	$411M	$341M	$212M	$170M	$256M	$734M	$779M	Cash & investmentsCash+inv
$15M	$26M	$56M	$30M	$57M	$85M	$30M	$33M	$38M	$60M	$53M	ReceivablesReceiv.
$2M	$4M	$7M	$7M	$26M	$27M	$13M	$24M	$14M	$9M	$13M	InventoryInvent.
$3M	$2M	$4M	$2M	$4M	$8M	$5M	$2M	$5M	$3M	$5M	Accounts payablePayables
$14M	$28M	$59M	$35M	$80M	$104M	$38M	$54M	$47M	$65M	$61M	Operating working capitalOper. WC
$163M	$237M	$871M	$1.1B	$501M	$465M	$264M	$237M	$332M	$832M	$865M	Current assetsCur. assets
$227M	$239M	$82M	$17M	$100M	$42M	$99M	$17M	$37M	$37M	$41M	Current liabilitiesCur. liab.
0.7×	1.0×	10.6×	66.1×	5.0×	11.2×	2.7×	14.1×	8.9×	22.2×	21.3×	Current ratioCurr. ratio
$72M	$86M	$87M	$95M	$190M	$106M	$0	$103M	$105M	$102M	$102M	GoodwillGoodwill
$602M	$671M	$1.3B	$1.5B	$1.4B	$1.3B	$763M	$787M	$942M	$1.6B	$1.5B	Total assetsAssets
—	$0	$610M	$639M	$442M	$321M	$0	—	$0	$446M	$447M	Total debtDebt
—	($202M)	($109M)	($431M)	$31M	($20M)	($212M)	—	($256M)	($287M)	($333M)	Net debt / (cash)Net debt
3.4×	5.1×	3.4×	22.6×	1.4×	5.3×	1.7×	18.2×	-7.4×	8.7×	16.9×	Interest coverageInt. cov.
$341M	$400M	$561M	$767M	$710M	$821M	$597M	$701M	$830M	$1.0B	$997M	Shareholders’ equityEquity
17.3%	17.7%	8.3%	20.4%	18.8%	16.1%	30.7%	19.6%	24.6%	17.5%	18.1%	Stock comp / revenueSBC/rev
											Per share
20.8M	23.5M	24.1M	19.8M	16.8M	17.2M	16.9M	17.8M	18.3M	20.3M	19.9M	Shares out (diluted)Shares
$5.23	$6.01	$10.45	$6.09	$9.72	$14.01	$11.63	$7.40	$9.14	$13.21	$13.80	Revenue / shareRev/sh
$-0.08	$0.53	$5.96	$31.85	$-0.18	$3.31	$-1.98	$2.94	$-0.22	$6.13	$7.72	EPS (diluted)EPS
$2.83	$3.68	$8.03	$-1.61	$2.98	$4.06	$7.11	$2.59	$5.21	$2.41	$6.19	Owner earnings / shareOE/sh
$2.83	$3.68	$8.03	$-1.61	$2.98	$4.06	$7.11	$2.59	$5.21	$2.41	$6.19	Free cash flow / shareFCF/sh
$0.09	$0.09	$0.04	$0.13	$0.26	$0.51	$1.06	$0.20	$0.10	$0.02	$0.02	Cap. spending / shareCapex/sh
$16.38	$17.03	$23.31	$38.83	$42.17	$47.61	$35.42	$39.47	$45.40	$50.12	$50.16	Book value / shareBVPS

Per-share growththe realized rate an owner's share compounded

	9-yr	5-yr
Revenue / share	+10.8%/yr	+6.3%/yr
Owner earnings / share	−1.8%/yr	−4.2%/yr
Capital spending / share	−14.2%/yr	−39.1%/yr
Book value / share	+13.2%/yr	+3.5%/yr

The record, charted

FY2016–2025

Each measure over its full record; the current point and the worst year marked.

Share count

20Mpeak FY2018

ROIC

2%low FY2024

Gross margin

97%low FY2016

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

$49Mowner earningsvs.$124Mnet incomelow FY2019

Where the cash went

ReinvestBuybacksDividendsAcquisitionsRetainedBeyond op. cash

Each year's outlays against its operating cash: the mix, and how it drifts. The hatched cap is spending beyond that year's operating cash — financed from the balance sheet or borrowing, not operations.

FY2016FY2025

Owner-earnings bridge

FY2021–FY2025cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2025 the business reported $124M of profit but $49M of owner earnings: $76M less than the profit line, taken out by capital spending and the timing of cash.

Reported net income$124M

Owner earnings$49M · 18% of revenue

	FY2025	FY2024	FY2023	FY2022	FY2021
Reported net income	$124M	($4M)	$52M	($33M)	$57M
Depreciation & amortizationnon-cash charge added back	+$34M	+$35M	+$37M	+$52M	+$51M
Stock-based compensationreal costnon-cash, but a real cost	+$47M	+$41M	+$26M	+$60M	+$39M
Working capital & othertiming of cash in and out, other non-cash items	−$156M	+$25M	−$65M	+$59M	−$68M
Cash from operations	$49M	$97M	$50M	$138M	$79M
Capital expenditurecash put back in to keep running and to grow	−$452K	−$2M	−$4M	−$18M	−$9M
Owner earnings	$49M	$95M	$46M	$120M	$70M
Owner-earnings marginowner earnings ÷ revenue	18%	57%	35%	61%	29%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the capital it must spend to hold its position . The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $47M), owner earnings is nearer $2M.

Much of fiscal 2025's profit didn't arrive as operating cash; it sits in “working capital & other” above. That can be a real inventory or timing swing, or profit that doesn't run through operating cash at all: a heavy tax year, equity-method earnings, or investment income booked through investing. For a year like this, owner earnings understates the cash earned; the full cash-flow statement carries the rest.

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 10-K · source on SEC EDGAR →

Will it survive?

Can it pay its interest? 8.7×

Comfortable

Operating income $41M ÷ interest expense $5M

What this means
Operating profit covers interest with the kind of margin Graham wanted for a defensive holding. Necessary, not sufficient, it says solvent, not cheap.
How heavy is the debt, net of cash? +$287M

Net cash

Cash $175M + ST investments $559M − debt $446M

What this means
Cash and short-term investments exceed every dollar of debt by $287M, on net the company owes nothing, and can act from strength when others can't. Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? 420d

Long (60+ days)

DSO 81 + DIO 526 − DPO 187 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash.

Is it a good business?

Return on invested capital 2%

Below average through the cycle

7-yr median, range -1%–48%; 2% latest = NOPAT $32M ÷ invested capital $1.3B

Industry peers: median -38%

What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 7 years (it ran 2% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
Owner-earnings margin 35%

High through the cycle

10-yr median margin, range -27%–77%; latest $49M = operating cash $49M − maintenance capex $452K

Industry peers: median -34%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 18% of revenue this year, a 35% median across 10 years. Treating stock comp as the real expense it is (less $47M of SBC) leaves $2M.
Are earnings backed by cash? 0.40×

Thinly cash-backed

Cash from ops $49M ÷ net income $124M

What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.

How is the cash used?

Where do the earnings go? 31%

Reinvests most of it

Dividends + buybacks $15M ÷ Owner Earnings $49M

What this means
Of $49M Owner Earnings, $15M (31%) went back to shareholders, $0 dividends, $15M buybacks. But the buybacks barely exceed stock issued to employees ($47M SBC), net of dilution, little was truly returned. Returning most of it is the mark of a mature business with little left to reinvest at a high return; reinvesting most could mean a long runway, or empire-building. The split doesn't say which; the return earned on it (see ROIC) does.
Investing or harvesting? 0.01×

Harvesting

Capex $452K ÷ depreciation $34M

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 2 of 6 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Miss

Revenue ≥ $2B · $268M

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Pass

Current ratio ≥ 2× · 22.23×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Conservative debt Pass

Debt ≤ working capital · $446M vs $795M WC

What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
Earnings stability Miss

A profit every year (10-yr record) · 4 loss years

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Miss

Uninterrupted dividends · none paid

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth Near

Earnings +33% over the record · +12%

What this means
At least a third more earnings than a decade ago, averaging three years at each end. Net income (not per-share), so stock splits don't distort it, buybacks and dilution show up in the share-count line instead.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $2.87/share (latest year $6.21), the averaged base the calculator's gate runs on, and book value is $50.76/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2016–2025

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 6 of 10

What this means
Lost money in 4 year(s), look at what happened there before trusting the average.
Return on capital ≥ 15% 1 of 8 yrs

What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
Operating margin 51% → 4% (3-yr avg ends)

What this means
Through the cycle the operating margin slipped — about 51% early to 4% lately, median 23% — competition or costs are biting in.
Reinvestment, incremental ROIC returns capital

What this means
The capital base barely grew: this business returns cash through dividends and buybacks rather than reinvesting. Judge it on the cash returned, not on compounding.
Owner earnings growth −0%/yr

What this means
Owner earnings shrank about 0% a year over the record.
Worst year 2024 · −13.5% op. margin

What this means
Operations went underwater in 2024, understand why before trusting the good years.
Share count −0.3%/yr

What this means
Roughly flat share count, little dilution, little buyback.

Does AI threaten the moat?

Low contestability

The moat is physical, regulated or balance-sheet-funded, the kind AI cuts costs within but does not contest.

In its own filing A competitive risk, new this year

Its FY2025 10-K names artificial intelligence as a competitive threat, in language that was not in the prior year's filing.

“Disruption or failure in AI functionality could adversely affect our business, cause delays or inaccuracies in our offerings, or harm our reputation.”

AI is unlikely to contest a moat that is physical, regulated or balance-sheet-funded; here it reads more as a cost tool than a threat.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of the latest quarter, Mar 31, 2026

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$865M

Cash & short-term investments$779M
Receivables$53M
Inventory$13M
Other current assets$19M

Current liabilities$41M

Accounts payable$5M
Other current liabilities$35M

Current ratio21.28×all current assets ÷ what's due · Graham looked for 2×

Quick ratio20.95×stricter: inventory excluded

Cash ratio19.17×strictest: cash alone against what's due

Working capital$825Mthe cushion left after near-term bills

Revenue, latest quarter vs. a year ago+14.1%the freshest read on whether the business is still growing

Current ratio, recent quarters16.8× → 21.3×

Deeper floors

Tangible book value$678Mequity stripped of goodwill & intangibles

Net current asset value$331MGraham's net-net: current assets less all liabilities

Debt incl. operating leases$33M$5M of it operating leases

Deferred revenue$621Kcustomer cash collected before delivery; operating float

From the company's latest filing.

How the cash was used, 2016–2025

Over the record, the business generated $781M of operating cash; how management split it reads as a cash returner, paying most of what it earns straight back to owners.

Reinvested$44M · 6%
Buybacks$675M · 86%
Retained (debt / cash)$62M · 8%

Returned to owners$675M
92% of the owner earnings the business produced over the span, $0 as dividends and $675M as buybacks.
Source of fundingOperating cash
Operating cash covered reinvestment and returns; over the span cash and short-term investments rose $638M.
Average price paid for buybacks$111.96
Across the years where the filing reports a share count, 6M shares were bought for $660M, about $111.96 each. Year to year the price paid ranged from $83.50 (2020) to $157.07 (2018); its heaviest year, 2019, paid $109.91 ($453M).
Net change in share count−4.6%
The diluted count fell from 21M to 20M, so the buybacks outran the stock issued to staff.
Dividend record—
No dividend line was reported in the filing data over the span; the record here neither confirms nor rules out a payout.
Return on what it retained−16%
Of the earnings it kept rather than paid out ($302M over the span), annual owner earnings (first three years vs last three) fell $49M, so each retained $1 gave back about 0.16 of yearly owner earnings. Buffett's test, run on owner earnings instead of market value.

Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.

Acquisitions & goodwill

from the balance sheet & the 10-year cash-flow record

Goodwill grows only when a company acquires and falls only when it concedes it overpaid. The size of that bet, the cash put into buying rather than building, and how much has already been written off.

Goodwill & intangibles$327M21% of all assets; the premium carried on the balance sheet for businesses acquired

Against book equity10%goodwill is this share of book equity; the rest is the company’s own retained and paid-in capital

Cash spent acquiring$552Mover 10 years buying other businesses, against $44M of capital spent building

None written down over the record; the goodwill is still carried at full cost. That is the deals holding their value on the books so far; whether they keep doing so is the test an owner watches, since the write-down, when it comes, is the admission the price was too high.

Goodwill, acquired intangibles and equity from the latest balance sheet; acquisition spend and write-downs summed across the 10-year record, from the company's own filings.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Chief executive	Pay, as filed	“Actually paid”	Owner earnings
2021	John L. Higgins	$9.6M	$16.0M	$70M
2022	John L. Higgins	$16.8M	$12.2M	$120M
2022	Todd C. Davis	$5.2M	$5.0M	$120M
2023	Todd C. Davis	$6.2M	$5.1M	$46M
2024	Todd C. Davis	$12.9M	$21.7M	$95M
2025	Todd C. Davis	$11.5M	$43.8M	$49M

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years.

Insider ownership5.6%
The stake all directors and executive officers hold together, per the 2026 proxy: skin in the game, the first thing Munger reads.
CEO pay ratio28:1
What the chief earns for every dollar the median employee makes, per the 2026 proxy. A high ratio alone settles nothing; some businesses are genuinely top-heavy in scarce skill. A runaway figure is where Buffett starts asking whether the board is doing its job.
Stock-based compensation$47M
The slice of the business handed to employees in shares this year, 17% of revenue, equal to 114% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.

Inverting the record

Invert: instead of why Ligand Pharmaceuticals is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2016–2025.

3 of the 5 tests turned up something to look into; the other 2 came back clean.

Look hereIs it less profitable than it was?36.8% vs 64.0%
The owner-earnings margin averaged 64.0% early in the record and 36.8% across the last three years, and the latest year has not recovered. Ask the filing whether that is a structural drift or a cyclical trough — price, mix, cost, or a competitor — and whether it is permanent.
Look hereDid reported profit become cash?0.80×
Across the record the business reported $977M of net income but generated $781M of operating cash, a 0.80-to-one conversion. Profit that does not turn into cash over many years is the classic mark of earnings that are softer than they look. Ask where the gap sits, receivables, inventory, or costs being capitalized rather than expensed.
Look hereDid receivables and inventory outpace sales?15% → 24% of sales
Receivables and inventory grew from $17M to $67M while revenue grew 152%: working capital is climbing faster than sales (15% of revenue then, 24% now). That can mean customers paying slower, stock building up, or revenue pulled forward. The filing's cash-flow and receivables notes say which.

And these came back clean

Did the share count rise anyway?
Are "one-time" charges a yearly habit?

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

Peers, Pharmaceuticals

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
EOLSEvolus Inc.	$297M	68%	-44.0%	-142%	-34%
IRWDIronwood Pharmaceuticals Inc.	$296M	94%	27.3%	44%	35%
RIGLRigel Pharmaceuticals Inc.	$294M	99%	-36.4%	-117%	-71%
XERSXeris Biopharma Holdings Inc.	$292M	—	-50.6%	-44%	9%
HROWHarrow Inc.	$272M	70%	0.8%	-11%	-1%
LGNDLigand Pharmaceuticals	$268M	96%	31.6%	2%	45%
ARVNArvinas Inc.	$263M	—	-306.3%	-37%	-118%
SDGRSchrodinger Inc.	$256M	57%	-80.8%	-38%	-53%
Group median	—	82%	-40.2%	-38%	-17%

The price

What a price has to assume.

What the price implies

reverse-DCF

Type today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Ligand Pharmaceuticals has delivered.

Today’s price $

Through the cycle, Ligand Pharmaceuticals earns about $119M on its 44.6% median owner-earnings margin. This year’s 18.2% margin runs below that; the reported figure may understate a lean year. Normalize, below, values the price on that through-cycle figure rather than the latest year.

Base Normalize · through-cycle ($119M) Net of stock comp (−$50M)

—

The assumptions Required return 9% Years of high growth 10 Terminal growth 2.5%

9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.

Enter a price above to run it.

Implied by the price—

Owner-earnings growth · ’21→’25−7%/yr

Owner-earnings growth · ’16→’25−0%/yr

Owner-earnings yield—

P/E (3-yr earnings ’23–’25)—

P/B—

Graham’s price gate—

Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.

Against a high-grade bond: Graham’s yardstick bond yield%

Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.

Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.

Owner earnings $123M on 20M shares outstanding, per the 10-Q cover, as of 2026-05-05; net cash $333M. The base is the latest year by default; Normalize values it on the through-cycle median owner-earnings margin (to avoid paying on a peak year). Net of stock comp treats option pay as the expense it is. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.

Weigh LGND against another business →

Cite: Owner Scorecard, "Ligand Pharmaceuticals (LGND), the owner's record," https://ownerscorecard.com/c/LGND, data as of 2026-07-09.

Manual order: ← LGN its page in the Manual LH →

Industry order: ← LEGN the Pharmaceuticals chapter LKFT →