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Why Is Ultragenyx (RARE) Down 11.4% Since Last Earnings Report?

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A month has gone by since the last earnings report for Ultragenyx (RARE - Free Report) . Shares have lost about 11.4% in that time frame, underperforming the S&P 500.

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

Ultragenyx's Q3 Earnings & Revenues Beat Estimates

Ultragenyx incurred a loss of $1.08 per share for third-quarter 2021, narrower than the Zacks Consensus Estimate of a loss of $1.43. The company reported a loss of $1.13 per share in the year-ago quarter.

Ultragenyx’s total revenues of $81.6 million in the third quarter grew marginally 0.2% year over year. The top line also surpassed the Zacks Consensus Estimate of $78 million.

Quarter in Detail

Ultragenyx markets three drugs, namely Crysvita, Mepsevii and Dojolvi (UX007). Crysvita is approved for the treatment of X-linked hypophosphatemia, an inherited disorder and tumor-induced osteomalacia, an ultra-rare disease. Mepsevii is approved to treat Mucopolysaccharidosis VII (MPS VII), also known as Sly syndrome. Dojolvi was approved last year for all forms of long-chain fatty acid oxidation disorders (LC-FAOD).

Crysvita’s total revenues were $55 million, up 35.3% year over year, driven by increased demand for both approved indications. Crysvita revenues in Ultragenyx territories rose 34.8% to $50.3 million in the quarter and included $42.9 million from the North America profit share territory as well as $7.4 million of net product sales for the drug in other regions. Total royalty revenues related to the sales of Crysvita in the European Territory were $4.7 million.

Mepsevii product revenues were $3.9 million in the quarter, down 3.9% year over year. Dojolvi (UX007) product revenues were $10.6 million compared with $3.8 million in the year-ago quarter, driven by strong new patient demand. Revenues in the quarter also included $12.1 million in relation to Ultragenyx’s collaboration and license agreement with Daiichi Sankyo.

Operating expenses rose 30% to $171.5 million in the quarter due to pipeline advancements. The company continues the commercialization of Dojolvi and supports six clinical programs, including four pivotal studies.

2021 Guidance

Owing to a strong performance in the third quarter of 2021, the company now expects Crysvita revenues toward the upper end of the guidance it provided earlier in the year. This range is $180-$190 million.

How Have Estimates Been Moving Since Then?

It turns out, estimates review have trended upward during the past month. The consensus estimate has shifted 8.79% due to these changes.

VGM Scores

At this time, Ultragenyx has a poor Growth Score of F, however its Momentum Score is doing a lot better with a B. However, the stock was allocated a grade of D on the value side, putting it in the bottom 40% 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, Ultragenyx has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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