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Emergent Biosolutions (EBS) Up 21.2% Since Last Earnings Report: Can It Continue?

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A month has gone by since the last earnings report for Emergent Biosolutions (EBS - Free Report) . Shares have added about 21.2% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Emergent Biosolutions due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.

Emergent Beats Q2 Earnings Estimates, Ups '20 Guidance

Emergent reported second-quarter 2020 earnings of $1.98 per share, which easily beat the Zacks Consensus Estimate of 53 cents. Moreover, the figure was up from earnings of 20 cents in the year-ago quarter.

Revenues in the reported quarter were up 62.3% from the prior-year period to $394.7 million, primarily due to an increase in product sales and contract development and manufacturing services revenues.

Quarter in Detail

Total product sales surged 63% to $298.5 million from the year-earlier quarter due to increased sales of anthrax vaccines and ACAM2000.

ACAM2000 generated sales of $70 million. Meanwhile, newly-acquired product, Narcan nasal spray, added $72.8 million to product sales, relatively flat year over year.

Notably, sales of anthrax vaccines (BioThrax and AV7909) were $132.3 million in the reported quarter, reflecting a significant increase year over year. Other product sales plunged 69% on a year-over-year basis to $23.4 million.

Revenues from contracts and grants decreased $17.4 million year over year to $23.6 million.

Contract manufacturing revenues surged to $72.6 million, increasing $53.9 million from the year-ago quarter’s figure due the company's landmark public-private CDMO partnership with BARDA in support of the U.S. government's Operation Warp Speed Program, related to the fight againstCOVID-19 pandemic.

The company recorded adjusted EBITDA of $15.3 million in the reported quarter compared with $8.4 million in the year-ago period, up 82.1%.

2020 Guidance

Emergent updated its financial outlook for the current year. The company now expects total revenues of $1.5-$1.6 billion compared with the previous forecast of $1.2 -$1.3 billion.

For the third quarter of 2020, the company expects total revenues of $420-$450 million.

How Have Estimates Been Moving Since Then?

Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.


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