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Amgen (AMGN) Stock Outperforms Industry YTD: Here's Why
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Amgen (AMGN - Free Report) is one of the biggest biotech companies in the world, with a strong presence in the oncology/hematology, cardiovascular disease, neuroscience, inflammation, bone health and nephrology and neuroscience markets.
Thousand Oaks, CA-based Amgen also has a promising pipeline of cancer drugs. It has one of the strongest cash positions in the biotech sector, which could be used to acquire more pipeline assets that could fuel long-term growth. Biosimilar drugs are also a key part of Amgen’s growth strategy.
Amgen has outperformed the industry year to date, Amgen’s stock has declined 3.3% so far this year compared with the decline of 11.9% for the industry.
Image Source: Zacks Investment Research
Strong Second-Quarter Results: Amgen’s second-quarter results were strong as it beat estimates for both earnings and sales. The company witnessed robust volume growth across all its three therapeutic areas — general medicine, inflammation and hematology-oncology portfolios. Sales of most key drugs like Prolia, Repatha, Evenity and Otezla topped expectations. Two of its newest medicines, Tezspire and Tavneos, once again achieved sequential growth in the quarter. It raised its earnings and sales guidance for the year as prescription trends and demand for its products are improving.
Key Products to Drive Sales: Amgen expects strong sales growth of products like Tezspire, Evenity, Repatha, Prolia and Tavneos to be offset by lower revenues from oncology biosimilars and legacy established products such as Enbrel in the future quarters.
Interesting Pipeline: Amgen also has some key pipeline assets in obesity and inflammation, which indicate a large market opportunity. Several data readouts are expected in the next 12 months.
Horizon Therapeutics Buyout May Boost Growth Prospects: In December 2022, Amgen announced a definitive agreement to acquire Horizon Therapeutics for $116.5 per share in cash or $27.8 billion. In May, the Federal Trade Commission (“FTC”) filed a lawsuit in Federal Court to halt the buyout deal.
Per the FTC, if the acquisition is allowed to go through, a large-cap giant like Amgen could leverage its position with insurance companies and pharmacy benefit managers to entrench the monopoly positions of two of Horizon's key products — Tepezza (approved for treating thyroid eye disease) and Krystexxa (approved for treating chronic refractory gout). Per the agency, the drugs currently face little to no competition in the market and are sold at very high prices to patients. However, last week, the FTC allowed the buyout to go through and the acquisition is expected to close in the fourth quarter.
The addition of Horizon Therapeutics, if successfully closed, will enhance Amgen’s growth prospects.
Estimates Rising: In the past 60 days, estimates for Amgen’s 2023 earnings per share have risen from $17.87 to $18.35 per share. During the same period, earnings per share estimates for 2024 have risen from $19.14 to $19.82. Earnings of Amgen beat estimates in all the last four quarters, witnessing an earnings surprise of 5.90%, on average.
Some better-ranked biotech companies are Exelixis (EXEL - Free Report) and Corcept Therapeutics (CORT - Free Report) , each with a Zacks Rank of 2 (Buy).
In the past 60 days, estimates for Exelixis’ 2023 earnings per share have risen from 89 cents to 98 cents per share. During the same period, earnings per share estimates for 2024 have risen from $1.31 to $1.36. Year to date, shares of Exelixis have risen 38.8%.
Earnings of Exelixis beat estimates in three of the last four quarters, delivering an earnings surprise of 18.62%, on average.
In the past 60 days, the Zacks Consensus Estimate for Corcept’s earnings has gone up from 62 cents per share to 78 cents for 2023. The bottom-line estimate has also improved from 61 cents to 83 cents for 2024 during the same time frame. Shares of the company have rallied 55.8% year to date.
CORT’s earnings beat estimates in two of the trailing four quarters and missed the mark in the other two, delivering an average surprise of 6.99%.
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Amgen (AMGN) Stock Outperforms Industry YTD: Here's Why
Amgen (AMGN - Free Report) is one of the biggest biotech companies in the world, with a strong presence in the oncology/hematology, cardiovascular disease, neuroscience, inflammation, bone health and nephrology and neuroscience markets.
Thousand Oaks, CA-based Amgen also has a promising pipeline of cancer drugs. It has one of the strongest cash positions in the biotech sector, which could be used to acquire more pipeline assets that could fuel long-term growth. Biosimilar drugs are also a key part of Amgen’s growth strategy.
Amgen has outperformed the industry year to date, Amgen’s stock has declined 3.3% so far this year compared with the decline of 11.9% for the industry.
Image Source: Zacks Investment Research
Strong Second-Quarter Results: Amgen’s second-quarter results were strong as it beat estimates for both earnings and sales. The company witnessed robust volume growth across all its three therapeutic areas — general medicine, inflammation and hematology-oncology portfolios. Sales of most key drugs like Prolia, Repatha, Evenity and Otezla topped expectations. Two of its newest medicines, Tezspire and Tavneos, once again achieved sequential growth in the quarter. It raised its earnings and sales guidance for the year as prescription trends and demand for its products are improving.
Key Products to Drive Sales: Amgen expects strong sales growth of products like Tezspire, Evenity, Repatha, Prolia and Tavneos to be offset by lower revenues from oncology biosimilars and legacy established products such as Enbrel in the future quarters.
Interesting Pipeline: Amgen also has some key pipeline assets in obesity and inflammation, which indicate a large market opportunity. Several data readouts are expected in the next 12 months.
Horizon Therapeutics Buyout May Boost Growth Prospects: In December 2022, Amgen announced a definitive agreement to acquire Horizon Therapeutics for $116.5 per share in cash or $27.8 billion. In May, the Federal Trade Commission (“FTC”) filed a lawsuit in Federal Court to halt the buyout deal.
Per the FTC, if the acquisition is allowed to go through, a large-cap giant like Amgen could leverage its position with insurance companies and pharmacy benefit managers to entrench the monopoly positions of two of Horizon's key products — Tepezza (approved for treating thyroid eye disease) and Krystexxa (approved for treating chronic refractory gout). Per the agency, the drugs currently face little to no competition in the market and are sold at very high prices to patients. However, last week, the FTC allowed the buyout to go through and the acquisition is expected to close in the fourth quarter.
The addition of Horizon Therapeutics, if successfully closed, will enhance Amgen’s growth prospects.
Estimates Rising: In the past 60 days, estimates for Amgen’s 2023 earnings per share have risen from $17.87 to $18.35 per share. During the same period, earnings per share estimates for 2024 have risen from $19.14 to $19.82. Earnings of Amgen beat estimates in all the last four quarters, witnessing an earnings surprise of 5.90%, on average.
Zacks Rank & Stocks to Consider
Amgen currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Amgen Inc. Price and Consensus
Amgen Inc. price-consensus-chart | Amgen Inc. Quote
Some better-ranked biotech companies are Exelixis (EXEL - Free Report) and Corcept Therapeutics (CORT - Free Report) , each with a Zacks Rank of 2 (Buy).
In the past 60 days, estimates for Exelixis’ 2023 earnings per share have risen from 89 cents to 98 cents per share. During the same period, earnings per share estimates for 2024 have risen from $1.31 to $1.36. Year to date, shares of Exelixis have risen 38.8%.
Earnings of Exelixis beat estimates in three of the last four quarters, delivering an earnings surprise of 18.62%, on average.
In the past 60 days, the Zacks Consensus Estimate for Corcept’s earnings has gone up from 62 cents per share to 78 cents for 2023. The bottom-line estimate has also improved from 61 cents to 83 cents for 2024 during the same time frame. Shares of the company have rallied 55.8% year to date.
CORT’s earnings beat estimates in two of the trailing four quarters and missed the mark in the other two, delivering an average surprise of 6.99%.