It has been about a month since the last earnings report for Mallinckrodt PLC . Shares have lost about 10% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Mallinckrodt Earnings, Revenues Beat Estimates in Q1
Mallinckrodt reported first-quarter 2017 results wherein both sales and earnings beat expectations.
The company reported adjusted earnings of $1.68 per share in the reported quarter, beating the Zacks Consensus Estimate of $1.63. Earnings were however down from the year-ago figure of $1.81. Higher sales and profits in the Specialty Brands segment offset the weakness in Specialty Generics.
Net sales in the quarter came in at $810.9 million, down 0.6% year over year but beat the Zacks Consensus Estimate of $787.5 million.
Quarter in Detail
The company reports results under two segments – Specialty Brands and Specialty Generics.
Sales at the Specialty Brands segment were $557.2 million, up 4.1% from the year-ago quarter. Acthar, Mallinckrodt’s largest product, garnered sales of $271.8 million, up 9.4%. Ofirmev sales grew 3.2% year over year to $73.4 million. Inomax, its second-largest product, generated sales of $128.4 million, up 11.2%.
Sales of the Therakos immunology platform were $51.2 million, up 2%. During the quarter the company resolved the third-party manufacturer production issue, incurring minimal impact from the supply imbalance.
As expected, weakness in the Specialty Generics segment continues. The segment recorded sales of $238.6 million, down 9.8% but better than management’s expectations due to the performance of methylphenidate HCl extended-release tablets, USP CII, and certain one-time orders within the segment's other products category.
Adjusted selling, general and administrative (SG&A) expenses in the reported quarter increased 12.6% to $237.4 million. Meanwhile, research and development (R&D) expense was up 7.1%.
During the first quarter, the company repurchased 5.6 million ordinary shares for $275.6 million under its share repurchase programs, bringing total shares repurchased since Jan 2015 under the company's authorized programs to 18.7 million, or approximately 16.1% of diluted shares outstanding.
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.
VGM Scores
At this time, Mallinckrodt's stock has a poor Growth Score of 'F', however its momentum is doing a lot better with a 'B'. Charting a somewhat similar path, the stock was allocated a grade of 'B' on the value side, putting it in the second quintile 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.
Our style scores indicate that the stock is suitable for both momentum and value investors.
Outlook
Notably, the stock has a Zacks Rank #3 (Hold). We expect in-line returns from the stock in the next few months.
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Mallinckrodt (MNK) Down 10% Since Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for Mallinckrodt PLC . Shares have lost about 10% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Mallinckrodt Earnings, Revenues Beat Estimates in Q1
Mallinckrodt reported first-quarter 2017 results wherein both sales and earnings beat expectations.
The company reported adjusted earnings of $1.68 per share in the reported quarter, beating the Zacks Consensus Estimate of $1.63. Earnings were however down from the year-ago figure of $1.81. Higher sales and profits in the Specialty Brands segment offset the weakness in Specialty Generics.
Net sales in the quarter came in at $810.9 million, down 0.6% year over year but beat the Zacks Consensus Estimate of $787.5 million.
Quarter in Detail
The company reports results under two segments – Specialty Brands and Specialty Generics.
Sales at the Specialty Brands segment were $557.2 million, up 4.1% from the year-ago quarter. Acthar, Mallinckrodt’s largest product, garnered sales of $271.8 million, up 9.4%. Ofirmev sales grew 3.2% year over year to $73.4 million. Inomax, its second-largest product, generated sales of $128.4 million, up 11.2%.
Sales of the Therakos immunology platform were $51.2 million, up 2%. During the quarter the company resolved the third-party manufacturer production issue, incurring minimal impact from the supply imbalance.
As expected, weakness in the Specialty Generics segment continues. The segment recorded sales of $238.6 million, down 9.8% but better than management’s expectations due to the performance of methylphenidate HCl extended-release tablets, USP CII, and certain one-time orders within the segment's other products category.
Adjusted selling, general and administrative (SG&A) expenses in the reported quarter increased 12.6% to $237.4 million. Meanwhile, research and development (R&D) expense was up 7.1%.
During the first quarter, the company repurchased 5.6 million ordinary shares for $275.6 million under its share repurchase programs, bringing total shares repurchased since Jan 2015 under the company's authorized programs to 18.7 million, or approximately 16.1% of diluted shares outstanding.
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.
Mallinckrodt PLC Price and Consensus
Mallinckrodt PLC Price and Consensus | Mallinckrodt PLC Quote
VGM Scores
At this time, Mallinckrodt's stock has a poor Growth Score of 'F', however its momentum is doing a lot better with a 'B'. Charting a somewhat similar path, the stock was allocated a grade of 'B' on the value side, putting it in the second quintile 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.
Our style scores indicate that the stock is suitable for both momentum and value investors.
Outlook
Notably, the stock has a Zacks Rank #3 (Hold). We expect in-line returns from the stock in the next few months.