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Nektar (NKTR) Down 10.9% Since Last Earnings Report: Can It Rebound?

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A month has gone by since the last earnings report for Nektar Therapeutics (NKTR - Free Report) . Shares have lost about 10.9% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Nektar 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.

Nektar Q4 Earnings & Revenues Top Estimates

Nektar reported a loss of 65 cents per share for the fourth quarter of 2020, narrower than the Zacks Consensus Estimate of a loss of 72 cents but wider than the year-ago loss of 64 cents.

Quarterly revenues declined 30.7% year over year to $23.5 million during the quarter. However, revenues beat the Zacks Consensus Estimate of $19.64 million.

Quarter in Detail

In the fourth quarter, product sales decreased 50.4% from the year-ago period to $2.9 million.  Non-cash royalty revenues were up 135.8% to $20.6 million.

License, collaboration and other revenues were $0.4 million in the quarter compared with $7.1 million in the year-ago quarter.

Research and development (R&D) expenses decreased 7% to $102.7 million. General and administrative (G&A) expenses remained flat year over year at $27.1 million in the reported quarter.

Full-Year Results

Nektar reported revenues of $152.9 million for the full year, up 33.4% year over year. The company incurred loss of $2.49 per share for 2020, 1.2% narrower than the year-ago period.

2021 Guidance

Nektar issued revenue and operating expense guidance for 2021. The company expects total revenues to be approximately $100 million in 2021. It will include $15 million to $20 million of product sales and $80 million to $85 million of non-cash royalty revenues. R&D expenses are expected to be in the range of $450-$500 million while G&A expenses are expected to be between $120 million and $125 million.

How Have Estimates Been Moving Since Then?

It turns out, estimates review have trended downward during the past month. The consensus estimate has shifted -32.9% due to these changes.

VGM Scores

At this time, Nektar has a poor Growth Score of F, however its Momentum Score is doing a bit better with a D. Charting a somewhat similar path, the stock was allocated a grade of F on the value side, putting it in the bottom 20% 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, Nektar has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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