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Mylan (MYL) to Report Q2 Earnings: Is a Beat in the Cards?

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Mylan N.V. (MYL - Free Report) is expected to beat on earnings when it reports second-quarter 2020 results on Aug 6.

The company’s performance has been excellent, beating earnings estimates in the trailing four quarters by 5.46%, on average. In the last reported quarter, the company’s earnings beat estimates by 2.27%.

Mylan N.V. Price, Consensus and EPS Surprise

 

Mylan N.V. Price, Consensus and EPS Surprise

Mylan N.V. price-consensus-eps-surprise-chart | Mylan N.V. Quote

Why a Likely Earnings Beat

Our proven model predicts an earnings beat for Mylan this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Earnings ESP: Mylan has an Earnings ESP of +4.25%, as the Zacks Consensus Estimate stands at 95 cents and the Most Accurate Estimate at 99 cents.

Zacks Rank: The company has a Zacks Rank #3.

Factors to Consider

The company reports results in three segments on a geographic basis — North America, Europe and the Rest of the World.

North America revenues reported 4% year-over-year growth in the last reported quarter primarily due to higher volumes on sales of existing products along with new product sales. The higher volumes were primarily driven by the expected growth of Yupelri and Wixela. The trend most likely continued in the second quarter. New product sales are being primarily driven by the robust performance of Wixela Inhub, the generic of Advair Diskus. The growth in demand for Fulphila (biosimilar to Neulasta) and Yupleri is likely to have boosted sales too.  

Incremental sales from Ogivri, a biosimilar to Roche’s Herceptin (trastuzumab), in the United States might have boosted sales further. In June, the FDA approved the New Drug Application (NDA) for Semglee (insulin glargine injection), in vial and pre-filled pen presentations, to control high blood sugar in adults with type 2 diabetes and adult and pediatric patients with type 1 diabetes. Mylan and partner Lupin also obtained Marketing Authorization for Nepexto, a biosimilar to Enbrel, in Europe.

The Zacks Consensus Estimate for this segment’s sales is $960 million.

Net sales in Europe are likely to have benefited from new products, including Hulio, and higher volumes of existing products in the to-be reported quarter.

The Zacks Consensus Estimate for this segment’s sales is $973 million.

The Rest of the World segment’s net sales were down in the previous quarter due to the unfavorable impact of foreign currency translation and the estimated negative impact of COVID-19 in China and Japan. The Zacks Consensus Estimate for this segment’s sales is $751 million.

Forward buying due to the impact of the coronavirus outbreak and the subsequent lockdown had positively impacted customer buying patterns in the first quarter but the impact most likely reversed in the second quarter. Investors will be keen to know the magnitude of the impact of the same in the second quarter and the rest of the year’s performance.

Key Anticipated Updates

Mylan entered into a global collaboration with Gilead Sciences (GILD - Free Report) to expand access to the investigational antiviral, remdesivir, for the potential treatment of COVID-19.

In November 2019, Mylan and Pfizer announced the name of the new company to be Viatris. Last month, the European Commission approved the combination of Mylan and Upjohn, conditioned upon the completion of the sale of certain products of the former in Europe. Shareholders have voted in favor of the proposed transaction.

Share Price Performance

Mylan’s stock has lost 15.5% in the year so far compared with the industry’s decline of 4.1%.

Other Stocks to Consider

Here are a few other companies worth considering, as per our model these too have the right mix of elements to beat on earnings this reporting cycle.

Bristol-Myers Squibb (BMY - Free Report) has an Earnings ESP of +0.23% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Incyte (INCY - Free Report) has an Earnings ESP of +4.62% and a Zacks Rank #3.

5 Stocks Set to Double

Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

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