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4 Drug, Biotech Stocks Set to Beat Q4 Earnings Estimates
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Quite a few big pharma/biotech stocks have reported fourth-quarter earnings, and the results so far have been mixed. Most of these companies seem to have recovered from the adverse effects of the pandemic, and sales of key drugs for the majority are on track to improve as patient visits normalize. Sales of vaccines, diagnostic tests and antibody treatments for COVID-19 have been stupendous and boosted the top line of their respective companies. In fact, the rapid development of vaccines and antibody treatments for COVID-19 aided the economic recovery in 2021, barring a few setbacks. Regulatory and pipeline developments are back on track with new drug approvals as the economic situation improves.
While some uncertainty prevails due to new emerging variants, most bigwigs provided an encouraging outlook for 2022 and look well placed to counter any future challenges.
Among the big pharma companies that have reported so far, Johnson & Johnson and AbbVie beat earnings estimates but missed on sales. Merck beat on both counts. Lilly missed earnings estimates while beating on sales. Novartis results were disappointing as it missed on both counts. In the biotech space, Amgen (AMGN - Free Report) outpaced earnings estimates but missed on sales. Bristol-Myers Squibb reported in-line fourth-quarter 2021 earnings while sales topped estimates on strong performance of key drugs. Biogen and Regeneron beat on both counts.
Per the Zacks classification, the pharma/biotech industry comes under the broader Medical sector, which comprises pharma/biotech and medical device companies.
Per the Earnings Trend report, as of Feb 2, 33.9% of the companies in the Medical sector, constituting nearly 53.7% of the sector’s market capitalization, have reported earnings. While 63.2% topped earnings estimates, 57.9% beat on sales. Earnings increased 10% year over year on 12.1% higher revenues. Overall, earnings for the Medical sector are expected to rise 18.4% on a 12.8% sales increase.
While the bigwigs are out with results, many companies are still left to report.
Zeroing in on the Winners
Here we have highlighted four drug/biotech companies, which are expected to beat on earnings in their upcoming quarterly results.
Earnings ESP is our proprietary methodology for determining the stocks that have the best chance to deliver an earnings surprise. Earnings ESP shows the percentage difference between the Most Accurate Estimate and the Zacks Consensus Estimate.
According to the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. The selection can be done with the help of the Zacks Stock Screener.
Our research shows that for stocks with this combination, the chance of an earnings surprise is as high as 70%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
4 Drug/Biotech Stocks That Match the Criteria
Vir Biotechnology, Inc’s (VIR - Free Report) fourth-quarter results have likely been boosted by sales of its monoclonal antibody for the early treatment of COVID-19, sotrovimab. The company has a profit-sharing arrangement with GlaxoSmithKline for the sale of sotrovimab and earns collaboration revenues from the same. Additional government purchase contracts for doses of this treatment might have fueled the top line.
The combination of Vir’s Earnings ESP of +32.05% and a Zacks Rank #1 (Strong Buy) raises the possibility of an earnings surprise in the to-be-reported quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.
Moderna’s (MRNA - Free Report) COVID-19 vaccine sales are likely to have boosted the company’s top line during the fourth quarter, which might have propelled the bottom line as well. The U.S. authorization for booster dose for all adults might have led to additional sales.
The combination of Moderna’s Earnings ESP of +3.28% and a Zacks Rank #3 raises the possibility of an earnings surprise in the to-be-reported quarter. The company is scheduled to release earnings for the fourth quarter of 2021 on Feb 24.
Jazz Pharmaceuticals’ (JAZZ - Free Report) revenues in the fourth quarter have likely been driven by sales of new drugs and drugs added from the acquisition of GW Pharmaceuticals. Jazz’s sleep disorder portfolio looks solid, and the strong uptake of Xywav is likely to have fueled the top line.
The company has an Earnings ESP of +2.09% and a Zacks Rank of #3.
ACADIA’s (ACAD - Free Report) sole marketed drug, Nuplazid, has recorded strong sales since its launch, and the same is likely to have boosted the top line in the fourth quarter. Solid volume growth in the third quarter fueled sales, and the same trend is expected to have prevailed in the to-be-reported quarter.
The company has an Earnings ESP of +7.26% and a Zacks Rank of #3.
ACADIA Pharmaceuticals Inc. Price and EPS Surprise
Image: Bigstock
4 Drug, Biotech Stocks Set to Beat Q4 Earnings Estimates
Quite a few big pharma/biotech stocks have reported fourth-quarter earnings, and the results so far have been mixed. Most of these companies seem to have recovered from the adverse effects of the pandemic, and sales of key drugs for the majority are on track to improve as patient visits normalize. Sales of vaccines, diagnostic tests and antibody treatments for COVID-19 have been stupendous and boosted the top line of their respective companies. In fact, the rapid development of vaccines and antibody treatments for COVID-19 aided the economic recovery in 2021, barring a few setbacks. Regulatory and pipeline developments are back on track with new drug approvals as the economic situation improves.
While some uncertainty prevails due to new emerging variants, most bigwigs provided an encouraging outlook for 2022 and look well placed to counter any future challenges.
Among the big pharma companies that have reported so far, Johnson & Johnson and AbbVie beat earnings estimates but missed on sales. Merck beat on both counts. Lilly missed earnings estimates while beating on sales. Novartis results were disappointing as it missed on both counts. In the biotech space, Amgen (AMGN - Free Report) outpaced earnings estimates but missed on sales. Bristol-Myers Squibb reported in-line fourth-quarter 2021 earnings while sales topped estimates on strong performance of key drugs. Biogen and Regeneron beat on both counts.
Per the Zacks classification, the pharma/biotech industry comes under the broader Medical sector, which comprises pharma/biotech and medical device companies.
Per the Earnings Trend report, as of Feb 2, 33.9% of the companies in the Medical sector, constituting nearly 53.7% of the sector’s market capitalization, have reported earnings. While 63.2% topped earnings estimates, 57.9% beat on sales. Earnings increased 10% year over year on 12.1% higher revenues. Overall, earnings for the Medical sector are expected to rise 18.4% on a 12.8% sales increase.
While the bigwigs are out with results, many companies are still left to report.
Zeroing in on the Winners
Here we have highlighted four drug/biotech companies, which are expected to beat on earnings in their upcoming quarterly results.
Earnings ESP is our proprietary methodology for determining the stocks that have the best chance to deliver an earnings surprise. Earnings ESP shows the percentage difference between the Most Accurate Estimate and the Zacks Consensus Estimate.
According to the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. The selection can be done with the help of the Zacks Stock Screener.
Our research shows that for stocks with this combination, the chance of an earnings surprise is as high as 70%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
4 Drug/Biotech Stocks That Match the Criteria
Vir Biotechnology, Inc’s (VIR - Free Report) fourth-quarter results have likely been boosted by sales of its monoclonal antibody for the early treatment of COVID-19, sotrovimab. The company has a profit-sharing arrangement with GlaxoSmithKline for the sale of sotrovimab and earns collaboration revenues from the same. Additional government purchase contracts for doses of this treatment might have fueled the top line.
The combination of Vir’s Earnings ESP of +32.05% and a Zacks Rank #1 (Strong Buy) raises the possibility of an earnings surprise in the to-be-reported quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.
Vir Biotechnology, Inc. Price and EPS Surprise
Vir Biotechnology, Inc. price-eps-surprise | Vir Biotechnology, Inc. Quote
Moderna’s (MRNA - Free Report) COVID-19 vaccine sales are likely to have boosted the company’s top line during the fourth quarter, which might have propelled the bottom line as well. The U.S. authorization for booster dose for all adults might have led to additional sales.
The combination of Moderna’s Earnings ESP of +3.28% and a Zacks Rank #3 raises the possibility of an earnings surprise in the to-be-reported quarter. The company is scheduled to release earnings for the fourth quarter of 2021 on Feb 24.
Moderna, Inc. Price and EPS Surprise
Moderna, Inc. price-eps-surprise | Moderna, Inc. Quote
Jazz Pharmaceuticals’ (JAZZ - Free Report) revenues in the fourth quarter have likely been driven by sales of new drugs and drugs added from the acquisition of GW Pharmaceuticals. Jazz’s sleep disorder portfolio looks solid, and the strong uptake of Xywav is likely to have fueled the top line.
The company has an Earnings ESP of +2.09% and a Zacks Rank of #3.
Jazz Pharmaceuticals PLC Price and EPS Surprise
Jazz Pharmaceuticals PLC price-eps-surprise | Jazz Pharmaceuticals PLC Quote
ACADIA’s (ACAD - Free Report) sole marketed drug, Nuplazid, has recorded strong sales since its launch, and the same is likely to have boosted the top line in the fourth quarter. Solid volume growth in the third quarter fueled sales, and the same trend is expected to have prevailed in the to-be-reported quarter.
The company has an Earnings ESP of +7.26% and a Zacks Rank of #3.
ACADIA Pharmaceuticals Inc. Price and EPS Surprise
ACADIA Pharmaceuticals Inc. price-eps-surprise | ACADIA Pharmaceuticals Inc. Quote