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Why Is Epizyme (EPZM) Up 3.8% Since Last Earnings Report?

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It has been about a month since the last earnings report for Epizyme (EPZM - Free Report) . Shares have added about 3.8% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Epizyme due for a pullback? 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.

Epizyme's Q2 Earnings Miss, Revenues Beat Estimates

Epizyme incurred a loss of 63 cents per share for second-quarter 2021, wider than the Zacks Consensus Estimate of a loss of 60 cents and the year-ago loss of 58 cents.

Total revenues for the second quarter were $13 million, which beat the Zacks Consensus Estimate of $8.7 million and considerably increased from the year-ago period’s $2.5 million.

Quarter in Detail

Tazverik received an accelerated approval from the FDA in January 2020 for the treatment of metastatic or locally-advanced Epithelioid Sarcoma (ES). In June 2020, the regulatory body approved the sNDA for Tazverik for two distinct follicular lymphoma (FL) indications.

The drug generated net product revenues worth $8 million in the second quarter pertaining to both ES and FL, up 29%, sequentially. Collaboration revenues in relation to Epizyme’s supply agreement with Japan partner Eisai were $5 million for the quarter.

The company reported a decrease in new prescriptions for Tazverik throughout the second quarter from pre-COVID levels. While patient demand grew 3% from the first-quarter level, net revenues were negatively impacted by an increase in PAP utilization. The COVID-19 pandemic continued to affect ES and FL patient visits to physicians, new patient starts across all lines of treatment, and the ability of Epizyme’s field-based teams to fully access ES and FL prescribers.

Adjusted research and development expenses increased 39.5% year over year to $32.7 million while selling, general and administrative expenses rose 7.4% to $29.1 million.

Epizyme had $244 million of cash, cash equivalents and marketable securities as of Jun 30, 2021 compared with $298.9 million on Mar 31, 2021. The company expects its current cash runway to extend to fourth-quarter 2022.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in estimates review. The consensus estimate has shifted 17.55% due to these changes.

VGM Scores

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


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