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Regeneron (REGN) Up 7.3% Since Earnings Report: Can It Continue?
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It has been about a month since the last earnings report for Regeneron Pharmaceuticals, Inc. (REGN - Free Report) . Shares have added about 7.3% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock's next earnings release, or is it 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 catalysts.
The company reported first-quarter 2017 earnings (including the impact of share-based compensation expenses and tax adjustments) of $2.16 per share, missing the Zacks Consensus Estimate of $2.50 and were up from $1.59 in the year-ago quarter.
Excluding share-based compensation expenses, Regeneron’s earnings came in at $2.92 per share, up from $2.40 reported in the year-ago quarter.
Total revenue in the first quarter increased 9.8% year over year to $1.32 billion driven by strong sales of eye treatment, Eylea. Revenues were above the Zacks Consensus Estimate of $1.29 billion. Total revenue comprises net product sales and collaboration revenues.
Regeneron has co-developed Eylea with the HealthCare unit of Bayer AG . The company is solely responsible for the U.S. sales of the eye drug and is entitled to profits. However, it shares profits and losses equally with Bayer from ex-U.S. Eylea sales, except in Japan, where the company receives a royalty on the net sales.
Quarterly Highlights
Net product sales increased to $858.2 million in the reported quarter, up 9.5% year over year. The majority of sales came from Eylea in the U.S. ($854 million, up 9.3%). Sales of Eylea in ex-U.S. markets were $484 million, up from $419 million reported in the year-ago quarter.
Revenues also include Sanofi and Bayer collaboration revenues of $404 million in first-quarter 2017, compared to $399 million in the year-ago quarter. Collaboration revenues from Sanofi were $210.4 million in the quarter, compared with $219.7 million a year ago. Praluent recorded global net sales of $36 million in the reported quarter, up from $13 in the year-ago quarter. We note Praluent has been co-developed in collaboration with Sanofi. Product sales for Praluent are recorded by Sanofi, while Regeneron shares profits or losses from the commercialization of the drug.
R&D expenses increased 7.9% while selling, general and administrative (SG&A) decreased 2.5% during the quarter.
2017 Outlook Updated
In 2017, Regeneron expects U.S. Eylea net sales to grow in single digits. The company now expects adjusted unreimbursed R&D expenses in the range of $950–$1,025 million. Adjusted SG&A costs are now projected in the range of $1.140–$1.200 billion compared to the earlier forecast $1.175–$1.250 billion.
We note that the European Commission approved a dosing regimen of 300mg for Praluent to be given every four weeks. The FDA recently approved Dupixent (dupilumab) Injection for the treatment of adults with moderate-to-severe atopic dermatitis (AD). Meanwhile, a phase III study of Dupixent in adolescent patients (12-17 years of age) with moderate-to-severe atopic dermatitis was initiated in first-quarter 2017.
A phase III study of Dupixent in pediatric patients (6-11 years of age) with uncontrolled persistent asthma was initiated in second-quarter 2017.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last one month period as none of them issued any earnings estimate revisions.
Regeneron Pharmaceuticals, Inc. Price and Consensus
At this time, the stock has a nice Growth Score of 'B', though it is lagging a lot on the momentum front with an 'F'. 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 'C'. If you aren't focused on one strategy, this score is the one you should be interested in.
The company's stock is suitable solely for growth based on our styles scores.
Outlook
The stock has a Zacks Rank #2 (Buy). We are expecting an above average return from the stock in the next few months.
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Regeneron (REGN) Up 7.3% Since Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Regeneron Pharmaceuticals, Inc. (REGN - Free Report) . Shares have added about 7.3% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock's next earnings release, or is it 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 catalysts.
Regeneron Q1 Earnings Miss, Revenues Beat Estimates
Regeneron reported first-quarter 2017 results wherein earnings missed estimates while revenues beat expectations.
The company reported first-quarter 2017 earnings (including the impact of share-based compensation expenses and tax adjustments) of $2.16 per share, missing the Zacks Consensus Estimate of $2.50 and were up from $1.59 in the year-ago quarter.
Excluding share-based compensation expenses, Regeneron’s earnings came in at $2.92 per share, up from $2.40 reported in the year-ago quarter.
Total revenue in the first quarter increased 9.8% year over year to $1.32 billion driven by strong sales of eye treatment, Eylea. Revenues were above the Zacks Consensus Estimate of $1.29 billion. Total revenue comprises net product sales and collaboration revenues.
Regeneron has co-developed Eylea with the HealthCare unit of Bayer AG . The company is solely responsible for the U.S. sales of the eye drug and is entitled to profits. However, it shares profits and losses equally with Bayer from ex-U.S. Eylea sales, except in Japan, where the company receives a royalty on the net sales.
Quarterly Highlights
Net product sales increased to $858.2 million in the reported quarter, up 9.5% year over year. The majority of sales came from Eylea in the U.S. ($854 million, up 9.3%). Sales of Eylea in ex-U.S. markets were $484 million, up from $419 million reported in the year-ago quarter.
Revenues also include Sanofi and Bayer collaboration revenues of $404 million in first-quarter 2017, compared to $399 million in the year-ago quarter. Collaboration revenues from Sanofi were $210.4 million in the quarter, compared with $219.7 million a year ago. Praluent recorded global net sales of $36 million in the reported quarter, up from $13 in the year-ago quarter. We note Praluent has been co-developed in collaboration with Sanofi. Product sales for Praluent are recorded by Sanofi, while Regeneron shares profits or losses from the commercialization of the drug.
R&D expenses increased 7.9% while selling, general and administrative (SG&A) decreased 2.5% during the quarter.
2017 Outlook Updated
In 2017, Regeneron expects U.S. Eylea net sales to grow in single digits. The company now expects adjusted unreimbursed R&D expenses in the range of $950–$1,025 million. Adjusted SG&A costs are now projected in the range of $1.140–$1.200 billion compared to the earlier forecast $1.175–$1.250 billion.
We note that the European Commission approved a dosing regimen of 300mg for Praluent to be given every four weeks. The FDA recently approved Dupixent (dupilumab) Injection for the treatment of adults with moderate-to-severe atopic dermatitis (AD). Meanwhile, a phase III study of Dupixent in adolescent patients (12-17 years of age) with moderate-to-severe atopic dermatitis was initiated in first-quarter 2017.
A phase III study of Dupixent in pediatric patients (6-11 years of age) with uncontrolled persistent asthma was initiated in second-quarter 2017.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last one month period as none of them issued any earnings estimate revisions.
Regeneron Pharmaceuticals, Inc. Price and Consensus
Regeneron Pharmaceuticals, Inc. Price and Consensus | Regeneron Pharmaceuticals, Inc. Quote
VGM Scores
At this time, the stock has a nice Growth Score of 'B', though it is lagging a lot on the momentum front with an 'F'. 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 'C'. If you aren't focused on one strategy, this score is the one you should be interested in.
The company's stock is suitable solely for growth based on our styles scores.
Outlook
The stock has a Zacks Rank #2 (Buy). We are expecting an above average return from the stock in the next few months.