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Drug, Biotech Stocks' Q3 Earnings on Nov 3: AMGN, REGN & More

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The earnings season is in full swing for the drug/biotech sector. Overall, it has been a mixed earnings season so far. While some companies like Merck, Biogen, Sanofi and Gilead beat the Zacks Consensus Estimate on both counts, a few drug/biotech companies like AbbVie and Novartis reported mixed results.

Some companies like Merck and Sanofi raised their sales and earnings expectations for the year while others kept their financial outlook intact as their expectations for better operational growth are likely to be offset by potentially greater currency headwinds.

Per the Zacks classification, the pharma/biotech industry comes under the broader Medical sector, which comprises pharma/biotech as well as medical device companies.

As of Oct 26, per the Earnings Trends report, 23.2% of the Medical sector participants, constituting 43% of the sector’s market capitalization, have already reported earnings. While 84.6% of the companies beat on earnings, 92.3% surpassed on revenues. Earnings decreased 1.8% year over year, while revenues rose 7.5%.

Overall, third-quarter earnings of the Medical sector are expected to decline 8.3%, while sales are projected to increase 3.8%.

Here we discuss five companies, Amgen (AMGN - Free Report) , Regeneron Pharmaceuticals (REGN - Free Report) , Moderna (MRNA - Free Report) , Teva Pharmaceutical Industries Limited (TEVA - Free Report) and Zoetis (ZTS - Free Report) , which are set to report third-quarter results on Nov 3.

Amgen

This large biotech’s performance has been strong, with earnings beating estimates in all the trailing four quarters. The company delivered a four-quarter earnings surprise of 5.59%, on average. In the last reported quarter, the company delivered an earnings surprise of 5.68%.

Amgen Inc. Price and EPS Surprise

Amgen Inc. Price and EPS Surprise

 

 

 

 

 

 

 

 

Amgen Inc. price-eps-surprise | Amgen Inc. Quote

Per our proven model, companies with the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) have a good chance of delivering an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Amgen has an Earnings ESP of -0.30% and a Zacks Rank #3. The Zacks Consensus Estimate for earnings stands at $4.43 per share.

Volume growth from Amgen key drugs like Prolia, Xgeva, Repatha, Otezla and Evenity, among others is expected to have been partially offset by biosimilar/generic competition for mature drugs. Third-quarter sales of Amgen’s new KRAS inhibitor, Lumakras, are likely to have been higher than $77 million recorded in the second quarter

Regeneron

This biotech has an impressive track record, having beaten earnings in all the past four quarters. In the last reported quarter, it beat earnings expectations by 14.54%. It surpassed earnings estimates by 30.54%, on average, in the last four quarters.

Regeneron has an Earnings ESP of -0.17% and a Zacks Rank #3. The Zacks Consensus Estimate for earnings stands at $9.65 per share.

Regeneron’s top line is likely to have been driven by higher sales of its eye drug, Eylea. Also, its share of profits/losses from partner Sanofi for their blockbuster immunology medicine, Dupixent, will be in focus. Sanofi, on its third-quarter earnings call, announced a 44.5% increase in Dupixent sales growth in the third quarter.

Moderna

Moderna’s surprise history has been mixed, with earnings beating estimates in three of the trailing four quarters while missing the same once. The average surprise is 20.72%. In the last reported quarter, the company delivered an earnings surprise of 16.44%.

Moderna, Inc. Price and EPS Surprise

Moderna, Inc. Price and EPS Surprise

Moderna, Inc. price-eps-surprise | Moderna, Inc. Quote

Moderna has an Earnings ESP of -17.62% and is a Zacks Rank #3 company. The Zacks Consensus Estimate stands at $3.04 per share.

For the third quarter, Moderna’s sales are likely to have been driven by its mRNA-based COVID-19 vaccine doses. However, the impact of the pandemic continues to subside globally. It remains to be seen how this factor has affected sales of Moderna’s vaccine. However, deliveries of the bivalent BA.4/BA.5 Omicron-targeting COVID-19 vaccine, mRNA-1273.222, after FDA authorized the same in August, are expected to have boosted COVID vaccine sales.

Teva Pharmaceutical Industries

Teva’s surprise history has been mixed, with earnings beating estimates in two of the trailing four quarters, missing in one and delivering in-line results in one. The four-quarter average surprise is 3.53%. In the last reported quarter, the company delivered an earnings surprise of 19.30%.

Teva has an Earnings ESP of -8.20% and holds a Zacks Rank #4 (Sell). The Zacks Consensus Estimate for Q3 earnings stands at 61 cents per share.

Zoetis

Zoetis’ earnings surprise history has been decent so far, having surpassed expectations in three of the trailing four quarters, while missing out on one, with an average surprise of 6.09%. In the last reported quarter, Zoetis delivered a negative earnings surprise of 1.64%.

Zoetis Inc. Price and EPS Surprise

Zoetis Inc. Price and EPS Surprise

Zoetis Inc. price-eps-surprise | Zoetis Inc. Quote

Zoetis has an Earnings ESP of +0.46% and a Zacks Rank #3, suggesting a likely earnings beat. The Zacks Consensus Estimate for earnings stands at $1.24 per share.

Zoetis is expected to have seen strong growth across its key dermatology portfolio. Zoetis’ companion animal business is likely to have performed well. However, sales of livestock products are likely to have declined, continuing the trend of the past quarter.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


 

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