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Ligand (LGND) Down 3% Since Last Earnings Report: Can It Rebound?
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It has been about a month since the last earnings report for Ligand Pharmaceuticals (LGND - Free Report) . Shares have lost about 3% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Ligand 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.
Ligand Q3 Earnings Miss, Sales Beat Estimates
Ligand reported third-quarter 2022 adjusted earnings (excluding the impact of gross profit for Captisol sales related to COVID-19) of 41 cents per share, missing the Zacks Consensus Estimate of 45 cents. The company had reported adjusted earnings of 64 cents in the year-ago quarter.
Reported earnings (including the impact of gross profit for Captisol sales related to COVID-19) for the third quarter stood at $1.31 per share, a 17.1% decline year over year.
Total revenues of $66.1 million were up 1.9% from the year-ago quarter as growth in Royalties revenues more than offset lower Contract revenues. The top line, however, beat the Zacks Consensus Estimate of $38 million.
Quarterly Highlights
Royalty revenues were up 27% year over year to $19.8 million in the third quarter. Growth in Royalties was mainly driven by additional sales of drugs developed using its Pelican platform.
The OmniAb business generated $0.3 million of total royalties in the third quarter.
Total Captisol sales were up 2.4% year over year to $35.9 million. Ligand reported its Captisol sales separately from core assets and COVID-related sales. The core Captisol sales were $3.6 million compared with $5.4 million in the year-ago quarter. COVID-related Captisol sales increased 9% to $32.4 million during the third quarter of 2022.
Contract revenues were down 27% year over year to $10.3 million in the third quarter due to the timing of partner milestone events. The OmniAb business generated $6.3 million of total Contract revenues in the third quarter.
2022 Guidance Raised
Ligand raised its guidance for sales from its business for 2022. The company now expects total revenues to be between $184 million and $189 million, up from the previous guidance of $133-$146 million. The company expects to earn royalties in the range of $66-$69 million.
Captisol sales are expected to be around $100 million, up from the previous the outlook of $55 million to $60 million. Out of $100 million, management expects to generate around $15 million from core Captisol sales and the remaining Captisol sales from COVID-related therapies.
Excluding COVID-related Captisol sales, management expects to record revenues in the range of $99-$104 million. Contract revenues are expected in the range of $18-$20 million.
Management now expects to record adjusted earnings between $4.30 and $4.45 per share in 2022, up from the previous guidance of $2.40-$3.00. These figures include the contribution of COVID-related Captisol sales that are likely to be around $2.25 per share.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates review.
The consensus estimate has shifted 202.94% due to these changes.
VGM Scores
Currently, Ligand has an average Growth Score of C, however its Momentum Score is doing a lot better with an A. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. 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 this revision looks promising. Notably, Ligand has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Ligand belongs to the Zacks Medical - Biomedical and Genetics industry. Another stock from the same industry, Incyte (INCY - Free Report) , has gained 7.6% over the past month. More than a month has passed since the company reported results for the quarter ended September 2022.
Incyte reported revenues of $823.3 million in the last reported quarter, representing a year-over-year change of +1.3%. EPS of $0.60 for the same period compares with $1.18 a year ago.
Incyte is expected to post earnings of $0.61 per share for the current quarter, representing a year-over-year change of +510%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Incyte. Also, the stock has a VGM Score of B.
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Ligand (LGND) Down 3% Since Last Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for Ligand Pharmaceuticals (LGND - Free Report) . Shares have lost about 3% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Ligand 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.
Ligand Q3 Earnings Miss, Sales Beat Estimates
Ligand reported third-quarter 2022 adjusted earnings (excluding the impact of gross profit for Captisol sales related to COVID-19) of 41 cents per share, missing the Zacks Consensus Estimate of 45 cents. The company had reported adjusted earnings of 64 cents in the year-ago quarter.
Reported earnings (including the impact of gross profit for Captisol sales related to COVID-19) for the third quarter stood at $1.31 per share, a 17.1% decline year over year.
Total revenues of $66.1 million were up 1.9% from the year-ago quarter as growth in Royalties revenues more than offset lower Contract revenues. The top line, however, beat the Zacks Consensus Estimate of $38 million.
Quarterly Highlights
Royalty revenues were up 27% year over year to $19.8 million in the third quarter. Growth in Royalties was mainly driven by additional sales of drugs developed using its Pelican platform.
The OmniAb business generated $0.3 million of total royalties in the third quarter.
Total Captisol sales were up 2.4% year over year to $35.9 million. Ligand reported its Captisol sales separately from core assets and COVID-related sales. The core Captisol sales were $3.6 million compared with $5.4 million in the year-ago quarter. COVID-related Captisol sales increased 9% to $32.4 million during the third quarter of 2022.
Contract revenues were down 27% year over year to $10.3 million in the third quarter due to the timing of partner milestone events. The OmniAb business generated $6.3 million of total Contract revenues in the third quarter.
2022 Guidance Raised
Ligand raised its guidance for sales from its business for 2022. The company now expects total revenues to be between $184 million and $189 million, up from the previous guidance of $133-$146 million. The company expects to earn royalties in the range of $66-$69 million.
Captisol sales are expected to be around $100 million, up from the previous the outlook of $55 million to $60 million. Out of $100 million, management expects to generate around $15 million from core Captisol sales and the remaining Captisol sales from COVID-related therapies.
Excluding COVID-related Captisol sales, management expects to record revenues in the range of $99-$104 million. Contract revenues are expected in the range of $18-$20 million.
Management now expects to record adjusted earnings between $4.30 and $4.45 per share in 2022, up from the previous guidance of $2.40-$3.00. These figures include the contribution of COVID-related Captisol sales that are likely to be around $2.25 per share.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates review.
The consensus estimate has shifted 202.94% due to these changes.
VGM Scores
Currently, Ligand has an average Growth Score of C, however its Momentum Score is doing a lot better with an A. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. 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 this revision looks promising. Notably, Ligand has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Ligand belongs to the Zacks Medical - Biomedical and Genetics industry. Another stock from the same industry, Incyte (INCY - Free Report) , has gained 7.6% over the past month. More than a month has passed since the company reported results for the quarter ended September 2022.
Incyte reported revenues of $823.3 million in the last reported quarter, representing a year-over-year change of +1.3%. EPS of $0.60 for the same period compares with $1.18 a year ago.
Incyte is expected to post earnings of $0.61 per share for the current quarter, representing a year-over-year change of +510%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Incyte. Also, the stock has a VGM Score of B.