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4 Pharma, Biotech Stocks Poised to Beat Q1 Earnings Estimates
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The earnings season has just started for the drug/biotech sector, with bellwether Johnson & Johnson (JNJ - Free Report) reporting first-quarter 2023 results last week. Per the Zacks classification, the large-cap pharma and drug/biotech industry comes under the broader Medical sector, which comprises medical device companies as well.
Per the Earnings Trends report, as of Apr 19, only 8.8% of the companies in the Medical sector, constituting nearly 27.5% of the sector’s market capitalization, reported earnings. All the companies that have reported so far have surpassed both earnings and sales estimates. Earnings declined 2.4% year over year but revenues increased 9.8%. Overall, first-quarter earnings for the Medical sector are expected to decline 22.4% on a 1% sales increase.
A major chunk of the large-cap pharma and drug/biotech sector is scheduled to report first-quarter results in the next two weeks. Johnson & Johnson reported strong results for the first quarter, beating earnings and sales estimates on the back of strong demand trends for its products. While the risk of a recession looms large, the outlook provided by most companies in the fourth quarter is encouraging due to new drug approvals and regular pipeline updates.
Zeroing in on Winners
Almost the entire sector is yet to report results. Here we have highlighted four companies, Sanofi (SNY - Free Report) , Amgen (AMGN - Free Report) , Regeneron Pharmaceuticals (REGN - Free Report) and Acadia Pharmaceuticals (ACAD - Free Report) — using our proprietary methodology — which are expected to deliver an earnings surprise in their upcoming quarterly results.
Earnings ESP is our proprietary methodology for determining the stocks with 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 made 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.
Sanofi focuses on major therapeutic areas such as immunology, neurology, oncology, rare disease, rare blood disorders and diabetes, among others. Sanofi has an Earnings ESP of +1.62% and a Zacks Rank #2. The Zacks Consensus Estimate for the first quarter stands at $1.08 per share.
Sanofi beat estimates in three of the last four quarters and missed in the remaining one, delivering an average earnings surprise of 7.68%. The company is scheduled to report first-quarter results on Apr 27.
Sanofi’s top-line growth is likely to have been aided by higher sales of the Specialty Care business, mainly driven by its blockbuster drug Dupixent. It witnessed strong demand for its approved indications, atopic dermatitis, asthma and chronic rhinosinusitis with nasal polyposis indications and strong launches for new indications, eosinophilic esophagitis and prurigo nodularis.
Amgen has an Earnings ESP of +1.82% and a Zacks Rank #3. The Zacks Consensus Estimate for the first quarter stands at $3.84 per share.
Amgen is one of the largest biotech companies with a strong presence in the oncology/hematology, cardiovascular disease, neuroscience, inflammation, bone health and nephrology and neuroscience markets. AMGN beat estimates in each of the last four quarters, delivering an average earnings surprise of 3.43%. Amgen is scheduled to report first-quarter results on Apr 27.
Growth products like Prolia, Xgeva, Evenity, Vectibix, Nplate and Kyprolis and Blincyto are likely to have aided the company.
Biotech major Regeneron Pharmaceuticals focuses on the discovery, development and commercialization of treatments targeting serious medical conditions. Regeneron maintains momentum on Dupixent’s stellar performance with progress on launches in pediatric atopic dermatitis, eosinophilic esophagitis and prurigo nodularis. Growth in lead drugs Eylea and Dupixent through additional label expansions and a promising late-stage pipeline set the momentum for further development.
REGN has an Earnings ESP of +5.80% and a Zacks Rank #3. The Zacks Consensus Estimate for the first quarter stands at $9.44 per share. REGN beat estimates in the last four quarters, delivering an average earnings surprise of 20.44%. Regeneron is scheduled to report first-quarter results on May 4.
Regeneron Pharmaceuticals, Inc. Price, Consensus and EPS Surprise
Acadia has an Earnings ESP of +32.26% and a Zacks Rank #2. The Zacks Consensus Estimate for the first quarter is pegged at a loss of 21 cents per share. ACAD beat estimates in two of the last four quarters and missed in the other two, delivering an average negative earnings surprise of 6.33%. The company is expected to report first-quarter results in the first week of May.
Acadia’s sole marketed drug, Nuplazid, approved for Parkinson's disease psychosis, has witnessed strong uptake since its launch and the momentum is likely to have continued in the first quarter. The drug's label expansion program looks promising, with several studies currently underway.
ACADIA Pharmaceuticals Inc. Price, Consensus and EPS Surprise
Image: Bigstock
4 Pharma, Biotech Stocks Poised to Beat Q1 Earnings Estimates
The earnings season has just started for the drug/biotech sector, with bellwether Johnson & Johnson (JNJ - Free Report) reporting first-quarter 2023 results last week. Per the Zacks classification, the large-cap pharma and drug/biotech industry comes under the broader Medical sector, which comprises medical device companies as well.
Per the Earnings Trends report, as of Apr 19, only 8.8% of the companies in the Medical sector, constituting nearly 27.5% of the sector’s market capitalization, reported earnings. All the companies that have reported so far have surpassed both earnings and sales estimates. Earnings declined 2.4% year over year but revenues increased 9.8%. Overall, first-quarter earnings for the Medical sector are expected to decline 22.4% on a 1% sales increase.
A major chunk of the large-cap pharma and drug/biotech sector is scheduled to report first-quarter results in the next two weeks. Johnson & Johnson reported strong results for the first quarter, beating earnings and sales estimates on the back of strong demand trends for its products. While the risk of a recession looms large, the outlook provided by most companies in the fourth quarter is encouraging due to new drug approvals and regular pipeline updates.
Zeroing in on Winners
Almost the entire sector is yet to report results. Here we have highlighted four companies, Sanofi (SNY - Free Report) , Amgen (AMGN - Free Report) , Regeneron Pharmaceuticals (REGN - Free Report) and Acadia Pharmaceuticals (ACAD - Free Report) — using our proprietary methodology — which are expected to deliver an earnings surprise in their upcoming quarterly results.
Earnings ESP is our proprietary methodology for determining the stocks with 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 made 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.
You can see the complete list of today’s Zacks #1 Rank stocks here.
4 Pharma/Biotech Stocks That Match the Criteria
Sanofi
Sanofi focuses on major therapeutic areas such as immunology, neurology, oncology, rare disease, rare blood disorders and diabetes, among others. Sanofi has an Earnings ESP of +1.62% and a Zacks Rank #2. The Zacks Consensus Estimate for the first quarter stands at $1.08 per share.
Sanofi beat estimates in three of the last four quarters and missed in the remaining one, delivering an average earnings surprise of 7.68%. The company is scheduled to report first-quarter results on Apr 27.
Sanofi’s top-line growth is likely to have been aided by higher sales of the Specialty Care business, mainly driven by its blockbuster drug Dupixent. It witnessed strong demand for its approved indications, atopic dermatitis, asthma and chronic rhinosinusitis with nasal polyposis indications and strong launches for new indications, eosinophilic esophagitis and prurigo nodularis.
Sanofi Price, Consensus and EPS Surprise
Sanofi price-consensus-eps-surprise-chart | Sanofi Quote
Amgen
Amgen has an Earnings ESP of +1.82% and a Zacks Rank #3. The Zacks Consensus Estimate for the first quarter stands at $3.84 per share.
Amgen is one of the largest biotech companies with a strong presence in the oncology/hematology, cardiovascular disease, neuroscience, inflammation, bone health and nephrology and neuroscience markets. AMGN beat estimates in each of the last four quarters, delivering an average earnings surprise of 3.43%. Amgen is scheduled to report first-quarter results on Apr 27.
Growth products like Prolia, Xgeva, Evenity, Vectibix, Nplate and Kyprolis and Blincyto are likely to have aided the company.
Amgen Inc. Price, Consensus and EPS Surprise
Amgen Inc. price-consensus-eps-surprise-chart | Amgen Inc. Quote
Regeneron Pharmaceuticals
Biotech major Regeneron Pharmaceuticals focuses on the discovery, development and commercialization of treatments targeting serious medical conditions. Regeneron maintains momentum on Dupixent’s stellar performance with progress on launches in pediatric atopic dermatitis, eosinophilic esophagitis and prurigo nodularis. Growth in lead drugs Eylea and Dupixent through additional label expansions and a promising late-stage pipeline set the momentum for further development.
REGN has an Earnings ESP of +5.80% and a Zacks Rank #3. The Zacks Consensus Estimate for the first quarter stands at $9.44 per share. REGN beat estimates in the last four quarters, delivering an average earnings surprise of 20.44%. Regeneron is scheduled to report first-quarter results on May 4.
Regeneron Pharmaceuticals, Inc. Price, Consensus and EPS Surprise
Regeneron Pharmaceuticals, Inc. price-consensus-eps-surprise-chart | Regeneron Pharmaceuticals, Inc. Quote
Acadia Pharmaceuticals
Acadia has an Earnings ESP of +32.26% and a Zacks Rank #2. The Zacks Consensus Estimate for the first quarter is pegged at a loss of 21 cents per share. ACAD beat estimates in two of the last four quarters and missed in the other two, delivering an average negative earnings surprise of 6.33%. The company is expected to report first-quarter results in the first week of May.
Acadia’s sole marketed drug, Nuplazid, approved for Parkinson's disease psychosis, has witnessed strong uptake since its launch and the momentum is likely to have continued in the first quarter. The drug's label expansion program looks promising, with several studies currently underway.
ACADIA Pharmaceuticals Inc. Price, Consensus and EPS Surprise
ACADIA Pharmaceuticals Inc. price-consensus-eps-surprise-chart | ACADIA Pharmaceuticals Inc. Quote