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Jazz Pharmaceuticals, a Zacks Rank #1 (Strong Buy), is a specialty biopharmaceutical company that identifies, develops, and commercializes pharmaceutical products in the United States, Europe, and internationally. The company boasts a strong drug portfolio with a primary focus in the areas of neuroscience and oncology.
The stock is displaying relative strength and has been making a series of 52-week highs. The price movement is a sign of strength as we head further into the new year. Increasing volume has attracted investor attention as buying pressure accumulates in this top-ranked stock.
The lifeblood of a bull market is rotation, or the passing of the baton from one group to the next. With every year comes a different market theme. It’s our job to identify that theme as early as possible and position our portfolios to benefit from it. This year’s market action has witnessed a notable rotation in industry strength.
Jazz Pharmaceuticals is part of the Zacks Medical – Biomedical and Genetics industry group, which currently ranks in the top 29% out of more than 250 industries. Because this group is ranked in the top half of all Zacks Ranked Industries, we expect it to outperform the market over the next 3 to 6 months, just as it has so far this year:
Image Source: Zacks Investment Research
Note the favorable metrics for this industry group below:
Image Source: Zacks Investment Research
Historical research studies suggest that approximately half of a stock’s price appreciation is due to its industry grouping. In fact, the top 50% of Zacks Ranked Industries outperforms the bottom 50% by a factor of more than 2 to 1.
It’s no secret that investing in stocks that are part of leading industry groups can give us a leg up relative to the market. By focusing on leading stocks within the top industries, we can dramatically improve our stock-picking success.
Company Description
Dublin, Ireland-based Jazz Pharmaceuticals derives the majority of its revenues from its sleep disorder drugs, Xywav and Xyrem. The company also has several ongoing and planned development activities in the sleep therapeutic area.
The acquisition of GW Pharmaceuticals marked Jazz’s entry into cannabidiol drugs with products like Epidiolex and Sativex. The addition of these drugs, especially Epidiolex, has helped the company diversify its neuroscience portfolio.
A growing global prescriber base with multiple launches outside the United States is driving demand for Epidiolex. The drug’s sales rose 15% in 2023 and another 15% in 2024. We expect the drug to achieve blockbuster status in 2025.
Apart from a strong neuroscience offering, Jazz also markets multiple oncology drugs. Last year, the oncology portfolio accounted for 29% of the company’s product revenues. These products not only bring in additional revenues, but also serve to diversify Jazz’s overall portfolio.
Earnings Trends and Future Estimates
Jazz Pharmaceuticals (JAZZ - Free Report) has built up an impressive reporting history, surpassing earnings estimates in three of the past four quarters. The company most recently delivered fourth-quarter earnings back in February of $6.60 per share, a 14% surprise over the $5.79/share consensus estimate.
Jazz has delivered a trailing four-quarter average surprise of 3.2%. Consistently beating earnings estimates is a recipe for success.
Analysts covering JAZZ are in agreement and have raised current-quarter EPS estimates by 5.3% in the past 60 days. The Zacks Consensus Estimate now stands at $4.57/share, reflecting potential growth of 70.5% relative to year-ago period. The company is set to report these quarterly results in May.
Image Source: Zacks Investment Research
Let’s Get Technical
This market leader has seen its stock advance more than 11% already this year, all while the general market remains in a correction. Only stocks that are in extremely powerful uptrends are able to experience this type of outperformance. This is the kind of stock we want to include in our portfolio – one that is trending well and receiving positive earnings estimate revisions.
Image Source: StockCharts
Notice how both the 50-day (blue line) and 200-day (red line) moving averages are sloping up. The stock has been making a series of higher highs throughout the past year. With both strong fundamental and technical indicators, JAZZ stock is poised to continue its outperformance.
Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. As we know, Jazz has recently witnessed positive revisions. As long as this trend remains intact (and JAZZ continues to deliver earnings beats), the stock will likely continue its bullish run.
Bottom Line
Backed by a leading industry group and history of earnings beats, it’s not difficult to see why JAZZ stock is a compelling investment. Robust fundamentals combined with an appealing technical trend certainly justify adding shares to the mix.
JAZZ is ranked favorably by our Zacks Style Scores with a top ‘A’ rating in our Value category and an overall ‘B’ VGM score. The stock is undervalued and trades at just six times forward earnings, well below the industry average. Promising earnings and sales trends point to continued growth ahead.
Recent positive earnings estimate revisions should also serve to create a ‘floor’ in terms of any sudden or unexpected downside moves. If you haven’t already done so, be sure to put JAZZ on your shortlist.
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Bull of the Day: Jazz Pharmaceuticals (JAZZ)
Jazz Pharmaceuticals, a Zacks Rank #1 (Strong Buy), is a specialty biopharmaceutical company that identifies, develops, and commercializes pharmaceutical products in the United States, Europe, and internationally. The company boasts a strong drug portfolio with a primary focus in the areas of neuroscience and oncology.
The stock is displaying relative strength and has been making a series of 52-week highs. The price movement is a sign of strength as we head further into the new year. Increasing volume has attracted investor attention as buying pressure accumulates in this top-ranked stock.
The lifeblood of a bull market is rotation, or the passing of the baton from one group to the next. With every year comes a different market theme. It’s our job to identify that theme as early as possible and position our portfolios to benefit from it. This year’s market action has witnessed a notable rotation in industry strength.
Jazz Pharmaceuticals is part of the Zacks Medical – Biomedical and Genetics industry group, which currently ranks in the top 29% out of more than 250 industries. Because this group is ranked in the top half of all Zacks Ranked Industries, we expect it to outperform the market over the next 3 to 6 months, just as it has so far this year:
Image Source: Zacks Investment Research
Note the favorable metrics for this industry group below:
Image Source: Zacks Investment Research
Historical research studies suggest that approximately half of a stock’s price appreciation is due to its industry grouping. In fact, the top 50% of Zacks Ranked Industries outperforms the bottom 50% by a factor of more than 2 to 1.
It’s no secret that investing in stocks that are part of leading industry groups can give us a leg up relative to the market. By focusing on leading stocks within the top industries, we can dramatically improve our stock-picking success.
Company Description
Dublin, Ireland-based Jazz Pharmaceuticals derives the majority of its revenues from its sleep disorder drugs, Xywav and Xyrem. The company also has several ongoing and planned development activities in the sleep therapeutic area.
The acquisition of GW Pharmaceuticals marked Jazz’s entry into cannabidiol drugs with products like Epidiolex and Sativex. The addition of these drugs, especially Epidiolex, has helped the company diversify its neuroscience portfolio.
A growing global prescriber base with multiple launches outside the United States is driving demand for Epidiolex. The drug’s sales rose 15% in 2023 and another 15% in 2024. We expect the drug to achieve blockbuster status in 2025.
Apart from a strong neuroscience offering, Jazz also markets multiple oncology drugs. Last year, the oncology portfolio accounted for 29% of the company’s product revenues. These products not only bring in additional revenues, but also serve to diversify Jazz’s overall portfolio.
Earnings Trends and Future Estimates
Jazz Pharmaceuticals (JAZZ - Free Report) has built up an impressive reporting history, surpassing earnings estimates in three of the past four quarters. The company most recently delivered fourth-quarter earnings back in February of $6.60 per share, a 14% surprise over the $5.79/share consensus estimate.
Jazz has delivered a trailing four-quarter average surprise of 3.2%. Consistently beating earnings estimates is a recipe for success.
Analysts covering JAZZ are in agreement and have raised current-quarter EPS estimates by 5.3% in the past 60 days. The Zacks Consensus Estimate now stands at $4.57/share, reflecting potential growth of 70.5% relative to year-ago period. The company is set to report these quarterly results in May.
Image Source: Zacks Investment Research
Let’s Get Technical
This market leader has seen its stock advance more than 11% already this year, all while the general market remains in a correction. Only stocks that are in extremely powerful uptrends are able to experience this type of outperformance. This is the kind of stock we want to include in our portfolio – one that is trending well and receiving positive earnings estimate revisions.
Image Source: StockCharts
Notice how both the 50-day (blue line) and 200-day (red line) moving averages are sloping up. The stock has been making a series of higher highs throughout the past year. With both strong fundamental and technical indicators, JAZZ stock is poised to continue its outperformance.
Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. As we know, Jazz has recently witnessed positive revisions. As long as this trend remains intact (and JAZZ continues to deliver earnings beats), the stock will likely continue its bullish run.
Bottom Line
Backed by a leading industry group and history of earnings beats, it’s not difficult to see why JAZZ stock is a compelling investment. Robust fundamentals combined with an appealing technical trend certainly justify adding shares to the mix.
JAZZ is ranked favorably by our Zacks Style Scores with a top ‘A’ rating in our Value category and an overall ‘B’ VGM score. The stock is undervalued and trades at just six times forward earnings, well below the industry average. Promising earnings and sales trends point to continued growth ahead.
Recent positive earnings estimate revisions should also serve to create a ‘floor’ in terms of any sudden or unexpected downside moves. If you haven’t already done so, be sure to put JAZZ on your shortlist.