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Axsome (AXSM) Up 11.7% Since Last Earnings Report: Can It Continue?

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It has been about a month since the last earnings report for Axsome Therapeutics (AXSM - Free Report) . Shares have added about 11.7% in that time frame, outperforming the S&P 500.

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

Axsome's Q2 Earnings Beat Estimates, Revenues Nil

Axsome incurred a loss of 86 cents per share for second-quarter 2021, slightly narrower than the Zacks Consensus Estimate of a loss of 88 cents but wider than the year-ago loss of 49 cents.

Axsome currently does not have any approved product in its portfolio. As a result, the company is yet to generate revenues from the same.

Quarter in Detail

Research and development expenses were $14.5 million for the quarter, up 37.6% from the year-ago period owing to increased costs due to NDA filings as well as increased stock compensation and personnel costs.

General and administrative expenses were $16.3 million, up 125.9% year over year. The significant increase was due to higher pre-commercialization activities related to AXS-05’s potential launch along with increased stock compensation and personnel costs.

As of Jun 30, 2021, Axsome had cash worth $141.2 million compared with $164.7 million as of Mar 31, 2021. Management believes that its cash balance as of June-end and $225 million worth term-loan facility will be enough to fund its anticipated operations at least through 2024.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates have trended upward during the past month. The consensus estimate has shifted 10.91% due to these changes.

VGM Scores

At this time, Axsome has a subpar Growth Score of D, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of F on the value side, putting it in the fifth quintile 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 trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Axsome has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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