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Why Is Arena Pharmaceuticals, Inc. (ARNA) Down 2.8% Since Last Earnings Report?

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It has been about a month since the last earnings report for Arena Pharmaceuticals, Inc. (ARNA - Free Report) . Shares have lost about 2.8% in that time frame, underperforming the S&P 500.

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

Arena Pharmaceuticals Q1 Earnings Beat, Revenues Nil

Arena Pharmaceuticals incurred a loss of $1.98 per share in the first quarter of 2021, narrower than the Zacks Consensus Estimate of a loss of $2.19. The company had incurred loss of $2.00 per share in the year-ago quarter.

Arena recorded no revenues in the reported quarter. The Zacks Consensus Estimates for revenues was pegged at $1 million. The company had recorded revenues of $0.3 million in the year-ago quarter.

Quarterly Details

Research & development (R&D) expenses escalated 30.6% from the prior-year level to $102.5 million, primarily as a result of the progress of its pipeline candidate, etrasimod, to the next phase of clinical development.

Selling, general and administrative expenses increased 11.7% from the year-ago figure to $29.5 million.

The company ended the quarter with approximately $1.1 billion in cash, cash equivalents and investments balance, same as of Sep 30, 2020.

How Have Estimates Been Moving Since Then?

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

VGM Scores

At this time, Arena Pharmaceuticals, Inc. 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 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 trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Arena Pharmaceuticals, Inc. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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