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Immunovant, Inc. (IMVT) Down 12.1% Since Last Earnings Report: Can It Rebound?

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A month has gone by since the last earnings report for Immunovant, Inc. (IMVT - Free Report) . Shares have lost about 12.1% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Immunovant, Inc. due for a breakout? 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.

Immunovant Reports Wider-Than-Expected Loss in Q3

The company reported a net loss of 32 cents per share in the third quarter of fiscal 2020, wider than the year-ago loss 28 cents and the Zacks Consensus Estimate of a loss of 26 cents.

The company does not generate any revenues.

Quarter in Detail

Research and development (R&D) expenses were $21 million, up from $4.9 million in the year ago quarter. The year-over-year increase was attributable toan $8.9 million increase in contract manufacturing costs driven by the expansion of the company’s clinical study programs for the treatment of autoimmune disease, and $1.4 million and $0.9 million increases in costs related to clinical studies and clinical research, respectively, due to expansion of the studies.

General and administrative (G&A) expenses were $10.5 million in the quarter, up from $6.1 million in the year ago quarter. The increase was primarily due to higher headcount, resulting in personnel costs and stock-based compensation expensesresulting from higher headcount.

Pipeline Update

In February 2021, the company voluntarily paused dosing in  ASCEND GO-2, a phase IIb study in thyroid eye disease (TED) and ASCEND-WAIHA, a phase II study in Warm Autoimmune HemolyticAnemia for IMVT-1401 due to elevated total cholesterol and LDL levels observed in patients treated with IMVT-1401. The company informed the regulators and investigators of this voluntary pause of dosing.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in estimates revision. The consensus estimate has shifted -13.64% due to these changes.

VGM Scores

Currently, Immunovant, Inc. has a poor Growth Score of F, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Immunovant, Inc. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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