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Why Is Aerie (AERI) Down 3.6% Since Last Earnings Report?

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It has been about a month since the last earnings report for Aerie Pharmaceuticals (AERI - Free Report) . Shares have lost about 3.6% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Aerie due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.

Aerie Q2 Earnings Miss Estimates, Revenues Rise Y/Y

Aerie reported a loss of 83 cents per share in second-quarter 2020 results, wider than the Zacks Consensus Estimate of a loss of 79 cents as well as the year-ago quarter’s loss of 80 cents.

Revenues came in at $18 million, which increased from $15.8 million in the year-ago quarter but missed the Zacks Consensus Estimate of $19 million.

Total revenues came from sales of two approved drugs, namely Rhopressa and Rocklatan.

The company’s first drug Rhopressa (netarsudil ophthalmic solution) has been approved for the reduction of elevated intraocular pressure (IOP) in patients with open-angle glaucoma or ocular hypertension. Aerie’s second drug Rocklatan, a once-daily, quadruple-action, fixed-dose combination of Rhopressa and Pfizer’s Xalatan, has been approved to reduce elevated IOP in patients with open-angle glaucoma or ocular hypertension.

Quarter in Detail

Wholesaler shipments totaled 232,000 bottles, which were slightly higher than the first quarter of 2020.

The second-quarter volumes slightly exceeded the first-quarter level, benefiting from the high levels of coverage the company gained, particularly in Medicare Part D.

Total operating expenses (excluding stock-based compensation expenses) in the quarter were $43.8 million, down from the year-ago quarter’s $50.5 million.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates have trended upward during the past month.

VGM Scores

Currently, Aerie has an average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. Charting a somewhat similar path, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Aerie has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.


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