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Biotech/Drug Stocks Q3 Earnings Due Nov 7: GILD, PRGO, VTRS & More
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Quite a few pharma and biotech bigwigs have reported results in the earnings cycle so far and the picture looks reasonably good. A number of pharma/biotechs are slated to report later in the week. Bellwether J&J reported strong third-quarter results, beating estimates for earnings as well as sales. Swiss pharma giant Novartis also beat earnings estimates and raised its guidance for core operating income. Among the biotechs, Amgen's third-quarter performance was mixed as it beat estimates for earnings but missed the mark for sales. Bristol-Myers Squibb Company (BMY - Free Report) reported better-than-expected third quarter results and updated its annual outlook for earnings.
Per the Zacks classification, the pharma/biotech industry comes under the broader Medical sector, which comprises pharma/biotech as well as medical device companies.
Per the Earnings Trends report, as of Nov 1, 51.7% of the companies in the Medical sector, constituting nearly 64.1% of the sector’s market capitalization, reported earnings. While 77.4% beat earnings estimates, 61.3% beat the same for sales. Earnings declined 17.8% year over year on 4.3% higher revenues. Overall, third-quarter earnings of the Medical sector are expected to decline 18.6% on a 5.5% sales increase.
Let’s analyze five drug/biotech companies — Gilead Sciences, Inc. (GILD - Free Report) , Perrigo Company plc (PRGO - Free Report) , Viatris Inc. (VTRS - Free Report) , Sage Therapeutics, Inc. (SAGE - Free Report) and Iovance Biotherapeutics (IOVA - Free Report) that are set to report third-quarter 2023 results on Nov 7.
Gilead Sciences, Inc.
Gilead has a mixed track record, having beaten Zacks Consensus Estimate in two of the trailing four quarters and missing in the remaining two, delivering an average earnings surprise of 2.77%. In the last reported quarter, it missed earnings expectations by 16.25%.
Per our proven model, stocks 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. The company currently has an Earnings ESP of -1.14% and a Zacks Rank #2 (Buy). You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Revenues in the third quarter are likely to have been boosted by increased sales in oncology and HIV franchises, as in the first and second quarters. A strong increase in Cell Therapy product sales is expected to have boosted the top line in the third quarter. Increased sales of Trodelvy, reflecting continued uptake in metastatic triple-negative breast cancer, might have boosted sales in the third quarter. Sales in the HIV franchise are being driven by higher demand for the flagship HIV therapies, Biktarvy and Descovy. However, a decline in Veklury (remdesivir) sales is likely to have dented the upside slightly.
The Zacks Consensus Estimate for third-quarter earnings per share is pegged at $1.91.
Gilead Sciences, Inc. Price, Consensus and EPS Surprise
Perrigo’s earnings surprise history has been decent, with its earnings beating the Zacks Consensus Estimate in three of the trailing four quarters and missing in the remaining one, with the average surprise being 2.95%. In the last reported quarter, Perrigo’s earnings beat the consensus estimate by 16.67%.
During the third quarter, the performance of Perrigo’s Consumer Self Care Americas (“CSCA”) and Consumer Self Care International (“CSCI”) segments is expected to have been aided by products added through its HRA Pharma acquisition. Significant sales growth of new products is likely to have boosted sales in the soon-to-be-reported quarter. However, currency movements and loss of sales following the divestiture of Latin American businesses are likely to have affected the company’s ex-U.S. sales.
Perrigo Company plc Price, Consensus and EPS Surprise
Viatris beat Zacks Consensus Estimate in the trailing four quarters, the average surprise being 5.89%. In the last reported quarter, the company beat estimates by 5.63%.
For the quarter to be reported, Viatris has an Earnings ESP of +6.12% and Zacks Rank #3. The combination of a positive Earnings ESP and a Zacks Rank #1, 2 or 3 increases the odds of an earnings beat.
Branded business and new launches are most likely to have driven sales in Developed Markets. Sales from Emerging Markets are likely to have increased on the strength of generics and branded businesses. Brands like Yupelri and Tyrvaya have likely maintained momentum for the company in the third quarter.
Sage Therapeutics has a dismal track record, with its earnings beating the Zacks Consensus Estimate in only one of the trailing four quarters and missing in the remaining three, with the average negative surprise being 3.87%. In the last reported quarter, SAGE missed earnings by 5.93%.
For the quarter to be reported, SAGE has an Earnings ESP of -24.86% and Zacks Rank #3.
While Zulresso sales have likely driven third-quarter results, investors will focus on updates on Zurzuvae. In August 2023, Sage received FDA approval for its second marketed drug Zurzuvae (zuranolone), for adult postpartum depression indication. Though the company also sought approval for Zurzuvae in major depressive disorder indication, the FDA issued a complete response letter requesting management to conduct more clinical studies.
Sage Therapeutics, Inc. Price, Consensus and EPS Surprise
IOVA has an excellent track record, with earnings beating the Zacks Consensus Estimate in all of the trailing four quarters, with the average surprise being 21.01%. In the last reported quarter, Iovance beat earnings by 41.98%.
Iovance Biotherapeutics, Inc. Price, Consensus and EPS Surprise
For the quarter to be reported, Iovance has an Earnings ESP of 0.0% and Zacks Rank #3.
The acquisition of Proleukin transformed the company into a commercial-stage biopharmaceutical company. Investor focus will be on Proleukin sales when it reports third-quarter results.
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Biotech/Drug Stocks Q3 Earnings Due Nov 7: GILD, PRGO, VTRS & More
Quite a few pharma and biotech bigwigs have reported results in the earnings cycle so far and the picture looks reasonably good. A number of pharma/biotechs are slated to report later in the week. Bellwether J&J reported strong third-quarter results, beating estimates for earnings as well as sales. Swiss pharma giant Novartis also beat earnings estimates and raised its guidance for core operating income. Among the biotechs, Amgen's third-quarter performance was mixed as it beat estimates for earnings but missed the mark for sales. Bristol-Myers Squibb Company (BMY - Free Report) reported better-than-expected third quarter results and updated its annual outlook for earnings.
Per the Zacks classification, the pharma/biotech industry comes under the broader Medical sector, which comprises pharma/biotech as well as medical device companies.
Per the Earnings Trends report, as of Nov 1, 51.7% of the companies in the Medical sector, constituting nearly 64.1% of the sector’s market capitalization, reported earnings. While 77.4% beat earnings estimates, 61.3% beat the same for sales. Earnings declined 17.8% year over year on 4.3% higher revenues. Overall, third-quarter earnings of the Medical sector are expected to decline 18.6% on a 5.5% sales increase.
Let’s analyze five drug/biotech companies — Gilead Sciences, Inc. (GILD - Free Report) , Perrigo Company plc (PRGO - Free Report) , Viatris Inc. (VTRS - Free Report) , Sage Therapeutics, Inc. (SAGE - Free Report) and Iovance Biotherapeutics (IOVA - Free Report) that are set to report third-quarter 2023 results on Nov 7.
Gilead Sciences, Inc.
Gilead has a mixed track record, having beaten Zacks Consensus Estimate in two of the trailing four quarters and missing in the remaining two, delivering an average earnings surprise of 2.77%. In the last reported quarter, it missed earnings expectations by 16.25%.
Per our proven model, stocks 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. The company currently has an Earnings ESP of -1.14% and a Zacks Rank #2 (Buy). You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Revenues in the third quarter are likely to have been boosted by increased sales in oncology and HIV franchises, as in the first and second quarters. A strong increase in Cell Therapy product sales is expected to have boosted the top line in the third quarter. Increased sales of Trodelvy, reflecting continued uptake in metastatic triple-negative breast cancer, might have boosted sales in the third quarter. Sales in the HIV franchise are being driven by higher demand for the flagship HIV therapies, Biktarvy and Descovy. However, a decline in Veklury (remdesivir) sales is likely to have dented the upside slightly.
The Zacks Consensus Estimate for third-quarter earnings per share is pegged at $1.91.
Gilead Sciences, Inc. Price, Consensus and EPS Surprise
Gilead Sciences, Inc. price-consensus-eps-surprise-chart | Gilead Sciences, Inc. Quote
Perrigo Company plc
Perrigo’s earnings surprise history has been decent, with its earnings beating the Zacks Consensus Estimate in three of the trailing four quarters and missing in the remaining one, with the average surprise being 2.95%. In the last reported quarter, Perrigo’s earnings beat the consensus estimate by 16.67%.
For the quarter to be reported, Perrigo has an Earnings ESP of 0.00% and a Zacks Rank #3. You can the complete list of today’s Zacks #1 Rank stocks here.
During the third quarter, the performance of Perrigo’s Consumer Self Care Americas (“CSCA”) and Consumer Self Care International (“CSCI”) segments is expected to have been aided by products added through its HRA Pharma acquisition. Significant sales growth of new products is likely to have boosted sales in the soon-to-be-reported quarter. However, currency movements and loss of sales following the divestiture of Latin American businesses are likely to have affected the company’s ex-U.S. sales.
Perrigo Company plc Price, Consensus and EPS Surprise
Perrigo Company plc price-consensus-eps-surprise-chart | Perrigo Company plc Quote
Viatris
Viatris beat Zacks Consensus Estimate in the trailing four quarters, the average surprise being 5.89%. In the last reported quarter, the company beat estimates by 5.63%.
For the quarter to be reported, Viatris has an Earnings ESP of +6.12% and Zacks Rank #3. The combination of a positive Earnings ESP and a Zacks Rank #1, 2 or 3 increases the odds of an earnings beat.
Branded business and new launches are most likely to have driven sales in Developed Markets. Sales from Emerging Markets are likely to have increased on the strength of generics and branded businesses. Brands like Yupelri and Tyrvaya have likely maintained momentum for the company in the third quarter.
Viatris Inc. Price, Consensus and EPS Surprise
Viatris Inc. price-consensus-eps-surprise-chart | Viatris Inc. Quote
Sage Therapeutics, Inc
Sage Therapeutics has a dismal track record, with its earnings beating the Zacks Consensus Estimate in only one of the trailing four quarters and missing in the remaining three, with the average negative surprise being 3.87%. In the last reported quarter, SAGE missed earnings by 5.93%.
For the quarter to be reported, SAGE has an Earnings ESP of -24.86% and Zacks Rank #3.
While Zulresso sales have likely driven third-quarter results, investors will focus on updates on Zurzuvae. In August 2023, Sage received FDA approval for its second marketed drug Zurzuvae (zuranolone), for adult postpartum depression indication. Though the company also sought approval for Zurzuvae in major depressive disorder indication, the FDA issued a complete response letter requesting management to conduct more clinical studies.
Sage Therapeutics, Inc. Price, Consensus and EPS Surprise
Sage Therapeutics, Inc. price-consensus-eps-surprise-chart | Sage Therapeutics, Inc. Quote
Iovance Biotherapeutics
IOVA has an excellent track record, with earnings beating the Zacks Consensus Estimate in all of the trailing four quarters, with the average surprise being 21.01%. In the last reported quarter, Iovance beat earnings by 41.98%.
Iovance Biotherapeutics, Inc. Price, Consensus and EPS Surprise
Iovance Biotherapeutics, Inc. price-consensus-eps-surprise-chart | Iovance Biotherapeutics, Inc. Quote
For the quarter to be reported, Iovance has an Earnings ESP of 0.0% and Zacks Rank #3.
The acquisition of Proleukin transformed the company into a commercial-stage biopharmaceutical company. Investor focus will be on Proleukin sales when it reports third-quarter results.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.