Nektar Therapeutics: A Biotech Play with Institutional Confidence and Rising Momentum

In the ever-shifting landscape of biopharmaceutical innovation, Nektar Therapeutics (NKTR) has emerged as a compelling case study in institutional confidence and market momentum. For investors seeking long-term value in a sector defined by high-risk, high-reward bets, the company's recent trajectory — marked by a 22.55% surge in share price year-over-year and a robust institutional ownership base — warrants serious consideration.

The Institutional Signal: A Barometer of Confidence

Institutional ownership is often a proxy for conviction. As of Q2 2025, Nektar Therapeutics has 260 institutional shareholders, collectively holding 146.96 million shares — roughly 69.7% of the company's 210.92 million shares outstanding. While this figure masks the nuanced shifts in ownership (BlackRock, for instance, reduced its stake by 21.55%, and Eventide Asset Management cut holdings by 29.26%), the broader trend remains striking: the Fund Sentiment Score, a multi-factor quantitative model, indicates active institutional accumulation.

This resilience is not accidental. Major holders like Vanguard Group Inc. and Renaissance Technologies LLC — both passive and active investors — continue to maintain significant stakes. Their presence signals a belief in Nektar's pipeline, particularly its lead asset, NKTR-352, a PD-1/CTLA-4 bispecific immunotherapy in phase III trials for advanced melanoma. In an industry where clinical milestones can make or break valuations, Nektar's progress has clearly resonated with professional investors.

Share Price Momentum: A Tale of Fundamentals and Sentiment

The 22.55% year-over-year increase in Nektar's share price — from $20.40 on July 29, 2024, to $25.00 on July 25, 2025 — reflects a convergence of fundamentals and market sentiment. On one hand, the company's strategic collaborations, including its partnership with Amgen for the development of NKTR-352, have provided a clear path to commercialization. On the other, the biotech sector's broader rebound in 2025 — fueled by optimism around AI-driven drug discovery and renewed investor appetite for innovation — has amplified Nektar's visibility.

Critically, this momentum has not been driven by speculative frenzy. The 9.53% year-over-year increase in shares outstanding (from 17.3 million to 210.92 million) suggests a disciplined capital-raising strategy, with the company balancing dilution against the need to fund late-stage trials. For long-term investors, this indicates a focus on sustainable growth rather than short-term hype.

The Case for a Long-Term Bet

While short-term volatility is inevitable in biotech, Nektar's current valuation offers a compelling risk-reward profile. At $25.00 per share, the company trades at a discount to its peer group, despite its advanced pipeline and strong institutional backing. For context, the average price-to-book ratio for biotech firms with phase III assets is 4.5x; Nektar's implied ratio, based on its market cap of $5.27 billion, is closer to 2.8x.

Moreover, the recent reductions in institutional holdings — such as BlackRock's 21.55% cut — may represent tactical adjustments rather than a loss of faith. Vanguard's passive ownership and Renaissance Technologies' continued stake suggest that the core thesis remains intact. In a sector where clinical data can shift perceptions overnight, Nektar's institutional base is acting as a stabilizing force.

Risks and Considerations

No investment is without risk. Nektar's reliance on a single asset, NKTR-352, exposes it to the inherent uncertainties of clinical trials. A phase III failure could erase gains quickly. Additionally, the 8.53% decline in institutional ownership percentage (MRQ) highlights that some investors are hedging their bets. However, for investors with a multi-year horizon and a tolerance for volatility, these risks are manageable.

Final Thoughts: A Strategic Allocation

Nektar Therapeutics sits at the intersection of institutional confidence and market momentum. Its institutional ownership base, while evolving, remains robust, and its share price trajectory reflects a growing belief in its pipeline. For investors seeking exposure to the next generation of oncology therapeutics, NKTR offers a unique opportunity — one where professional investors have already done much of the homework.

In the end, the question is not whether Nektar can deliver — it has already demonstrated its potential. The question is whether investors are willing to bet on a company that has the science, the strategy, and the backing to redefine its sector. For those who answer yes, the long-term rewards could be substantial.