A month has gone by since the last earnings report for Prothena (PRTA Quick QuotePRTA - Free Report) . Shares have lost about 19.9% in that time frame, underperforming the S&P 500.

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

Prothena Q3 Earnings and Revenues Miss Estimates

The company reported a loss of 77 cents per share, wider than the Zacks Consensus Estimate of a loss of 68 cents and the year-ago quarter’s loss of 49 cents.

Revenues mainly came from the company’s collaboration with Roche. Quarterly revenues came in at $0.16 million, missing the Zacks Consensus Estimate by 70.54%. Revenues were down from $0.2 million in the year-ago quarter.

Quarter in Detail

R&D expenses were $21.6 million, up from $12.5 million in the year-ago quarter due to higher manufacturing costs, increased collaboration expenses with Roche related to the prasinezumab program and elevated R&D consulting expenses.

General and administrative (G&A) expenses came in at $9.4 million, up from $8.7 million in the year-ago quarter.

As of Sep 30, 2020, Prothena had $317.2 million in cash, cash equivalents and restricted cash.

Pipeline Updates

The company is evaluating prasinezumab in collaboration with Roche for the treatment of Parkinson’s disease.

Roche recently presented results from the phase II PASADENA study of prasinezumab in patients with early Parkinson’s disease. Results showed that prasinezumab significantly reduced decline in motor function by 35% (pooled dose levels) versus placebo after one year of treatment on the centrally rated assessment of Movement Disorder Society-Unified Parkinson's Disease Rating Scale (MDS-UPDRS) Part III, a clinical examination of motor function. Additionally, prasinezumab-treated patients demonstrated a significant delay in time to clinically meaningful worsening of motor progression on the site rated assessment of time to at least a 5-point progression on MDS-UPDRS Part III compared to placebo over one year, with a hazard ratio of 0.82.

The companies will advance prasinezumab into a phase IIb study in patients with early Parkinson’s disease. The study will be designed to further assess the efficacy of prasinezumab by expanding the patient population enrolled in PASADENA to include patients with early Parkinson’s disease on stable levodopa therapy.

Prothena expects to report new data in the fourth quarter of this year from the dose-escalation and available LTE portion of the study on PRX004, a potential treatment for ATTR amyloidosis.



 

How Have Estimates Been Moving Since Then?

It turns out, estimates review have trended downward during the past month. The consensus estimate has shifted -6.29% due to these changes.

VGM Scores

Currently, Prothena has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. However, the stock was allocated a grade of F on the value side, putting it in the fifth 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 downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Prothena has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.