We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
5 Drug/Biotech Stocks Poised to Beat Q1 Earnings Estimates
Read MoreHide Full Article
The overall picture in first-quarter earnings season looks positive for the medical sector. The latest Earnings Trend shows thahat total earnings for the medical sector are up 9.3% from the same period last year on 10.1% higher revenues so far.
The scenario in the drug/biotech sector is rapidly changing with its focus on buyouts, new drug approvals using better technology and untapped avenues like the gene therapy. Acquisition activity has taken centrestage in the year so far. A slowdown in mature products due to intense competition and the rise of biosimilars forced most pharma bigwigs to eye lucrative integrations to bolster their pipelines. For example, Bristol-Myers Squibb Company (BMY - Free Report) , one of the largest pharma giants is all set to acquire the leading biotech company Celgene for a whopping $74 billion in what could be one of the largest transaction deals inked of late. Roche too is looking to purchase the gene therapy player Spark Therapeutics. Another large-cap pharma company Eli Lilly (LLY - Free Report) bought Loxo Oncology for $8 billion to broaden its oncology portfolio.
Meanwhile, the federal government’s focus on high drug prices propelled companies to slash the prices of key drugs.
While issues like government scrutiny of high prices, pricing and competitive pressure, sluggish sales of some of the most high-profile older drugs and major pipeline setbacks will be relentless headwinds to the industry on one hand, the new drug approvals as well as label expansions of the existing drugs on the other, should help the companies offset the downtrend from their legacy drugs in the first quarter. New drug approvals in the year so far include Egaten, Evenity, Zulresso and Rocklatan among others. We expect these nods to positively influence the guidance provided by the companies.
From the bracket of companies that has already reported, biggies like Bristol-Myers Squibb Company, Alexion, Biogen, etc. — all beat on both the top and the bottom line.
How to Pick Potential Q1 Winners?
While quite a few big shots from the drug/biotech sector have already announced results, there are a few companies, which are poised to surpass on first-quarter key metrics. However, given the huge turnout of the drug/biotech firms this earnings season, the task of selecting stocks with beat prospects could be a daunting one.
By means of the Zacks Stock Screener, we have zeroed in on five drug/ biotech stocks with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) and a positive Earnings ESP. These are valuable tools for investors looking for stocks with high potential to outpace estimates in the impending quarterly results. Moreover, stocks with a top Zacks Rank and a positive ESP have 70% chance to deliver a positive surprise in the ongoing reporting cycle. While you can see the complete list of today’s Zacks #1 Rank stocks here, you can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
Watch Out for 5 Stocks to Reap Fat Returns
Gilead Sciences, Inc. (GILD - Free Report) has an Earnings ESP of +1.54% and a Zacks Rank #2. The Zacks Consensus Estimate for earnings in first-quarter 2019 stands at $1.63. The company has average trailing four-quarter positive surprise of 1.99%. It is scheduled to release financial figures on May 2.
Aduro Biotech, Inc. has an Earnings ESP of +82.00% and a Zacks Rank of 2. The Zacks Consensus Estimate for first-quarter 2019 earnings is pegged at a loss of 17 cents. .
bluebird bio, Inc. (BLUE - Free Report) has an Earnings ESP of +12.12% and is a Zacks #2 Ranked player. The Zacks Consensus Estimate for first-quarter 2019 earnings is pegged at a loss of $2.80.
Ironwood Pharmaceuticals, Inc. (IRWD - Free Report) has an Earnings ESP of +43.04% and is a #2 Ranked player. The Zacks Consensus Estimate for first-quarter 2019 earnings stands at a loss of 16 cents. The company is scheduled to announce results on May 2.
Mallinckrodt public limited company has an Earnings ESP of +0.25% and a Zacks Rank of 1. The Zacks Consensus Estimate for earnings in first-quarter 2019 stands at $1.75. The company is scheduled to report the same on May 7.
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2018, while the S&P 500 gained +15.8%, five of our screens returned +38.0%, +61.3%, +61.6%, +68.1%, and +98.3%.
This outperformance has not just been a recent phenomenon. From 2000 – 2018, while the S&P averaged +4.8% per year, our top strategies averaged up to +56.2% per year.
Image: Bigstock
5 Drug/Biotech Stocks Poised to Beat Q1 Earnings Estimates
The overall picture in first-quarter earnings season looks positive for the medical sector. The latest Earnings Trend shows thahat total earnings for the medical sector are up 9.3% from the same period last year on 10.1% higher revenues so far.
The scenario in the drug/biotech sector is rapidly changing with its focus on buyouts, new drug approvals using better technology and untapped avenues like the gene therapy. Acquisition activity has taken centrestage in the year so far. A slowdown in mature products due to intense competition and the rise of biosimilars forced most pharma bigwigs to eye lucrative integrations to bolster their pipelines. For example, Bristol-Myers Squibb Company (BMY - Free Report) , one of the largest pharma giants is all set to acquire the leading biotech company Celgene for a whopping $74 billion in what could be one of the largest transaction deals inked of late. Roche too is looking to purchase the gene therapy player Spark Therapeutics. Another large-cap pharma company Eli Lilly (LLY - Free Report) bought Loxo Oncology for $8 billion to broaden its oncology portfolio.
Meanwhile, the federal government’s focus on high drug prices propelled companies to slash the prices of key drugs.
While issues like government scrutiny of high prices, pricing and competitive pressure, sluggish sales of some of the most high-profile older drugs and major pipeline setbacks will be relentless headwinds to the industry on one hand, the new drug approvals as well as label expansions of the existing drugs on the other, should help the companies offset the downtrend from their legacy drugs in the first quarter. New drug approvals in the year so far include Egaten, Evenity, Zulresso and Rocklatan among others. We expect these nods to positively influence the guidance provided by the companies.
From the bracket of companies that has already reported, biggies like Bristol-Myers Squibb Company, Alexion, Biogen, etc. — all beat on both the top and the bottom line.
How to Pick Potential Q1 Winners?
While quite a few big shots from the drug/biotech sector have already announced results, there are a few companies, which are poised to surpass on first-quarter key metrics. However, given the huge turnout of the drug/biotech firms this earnings season, the task of selecting stocks with beat prospects could be a daunting one.
By means of the Zacks Stock Screener, we have zeroed in on five drug/ biotech stocks with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) and a positive Earnings ESP. These are valuable tools for investors looking for stocks with high potential to outpace estimates in the impending quarterly results. Moreover, stocks with a top Zacks Rank and a positive ESP have 70% chance to deliver a positive surprise in the ongoing reporting cycle. While you can see the complete list of today’s Zacks #1 Rank stocks here, you can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
Watch Out for 5 Stocks to Reap Fat Returns
Gilead Sciences, Inc. (GILD - Free Report) has an Earnings ESP of +1.54% and a Zacks Rank #2. The Zacks Consensus Estimate for earnings in first-quarter 2019 stands at $1.63. The company has average trailing four-quarter positive surprise of 1.99%. It is scheduled to release financial figures on May 2.
Aduro Biotech, Inc. has an Earnings ESP of +82.00% and a Zacks Rank of 2. The Zacks Consensus Estimate for first-quarter 2019 earnings is pegged at a loss of 17 cents. .
bluebird bio, Inc. (BLUE - Free Report) has an Earnings ESP of +12.12% and is a Zacks #2 Ranked player. The Zacks Consensus Estimate for first-quarter 2019 earnings is pegged at a loss of $2.80.
Ironwood Pharmaceuticals, Inc. (IRWD - Free Report) has an Earnings ESP of +43.04% and is a #2 Ranked player. The Zacks Consensus Estimate for first-quarter 2019 earnings stands at a loss of 16 cents. The company is scheduled to announce results on May 2.
Mallinckrodt public limited company has an Earnings ESP of +0.25% and a Zacks Rank of 1. The Zacks Consensus Estimate for earnings in first-quarter 2019 stands at $1.75. The company is scheduled to report the same on May 7.
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2018, while the S&P 500 gained +15.8%, five of our screens returned +38.0%, +61.3%, +61.6%, +68.1%, and +98.3%.
This outperformance has not just been a recent phenomenon. From 2000 – 2018, while the S&P averaged +4.8% per year, our top strategies averaged up to +56.2% per year.
See their latest picks free >>