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Why Is Sage Therapeutics, Inc. (SAGE) Up 12.7% Since Last Earnings Report?

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A month has gone by since the last earnings report for Sage Therapeutics, Inc. (SAGE - Free Report) . Shares have added about 12.7% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Sage Therapeutics, Inc. due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.

Q3 Earnings & Sales Miss Estimates

Sage reported a loss of $3.37 per share for the third quarter of 2023, wider than the year-ago quarter’s loss of $2.31.

The reported loss included restructuring expenses of $33.6 million related to a reorganization plan implemented in August 2023. The adjusted loss per share in the quarter stood at $2.81 per share, missing the Zacks Consensus Estimate of a loss of $2.64.

Revenues in the quarter were $2.7 million, up 56% year over year. Sales missed the Zacks Consensus Estimate of $8.7 million.

Quarter in Detail

In the reported quarter, revenues comprised entirely from Zulresso product revenues.

Research & development (R&D) expenses were $101.9 million, up 25% from the year-ago quarter’s levels. The upside was primarily due to expenses related to canceling excess purchase commitments for manufacturing as a result of the complete response letter received from the FDA for zuranolone for the treatment of MDD.

Selling, general and administrative expenses (SG&A) rose 27% from the prior-year quarter’s figure to $78.1 million. This increase can be attributed to increased stock-based compensation expenses during the quarter.

The company had $0.9 billion in cash, cash equivalents and marketable securities as of Sep 30, 2023, compared with $1.0 billion on Jun 30, 2023. This cash balance, combined with expected funding from collaboration revenues, is expected to support the company’s operations into 2026.

How Have Estimates Been Moving Since Then?

It turns out, estimates review flatlined during the past month.

The consensus estimate has shifted 20.23% due to these changes.

VGM Scores

At this time, Sage Therapeutics, Inc. has a poor Growth Score of F, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of F on the value side, putting it in the bottom 20% quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Sage Therapeutics, Inc. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Sage Therapeutics, Inc. is part of the Zacks Medical - Drugs industry. Over the past month, Ionis Pharmaceuticals (IONS - Free Report) , a stock from the same industry, has gained 6.1%. The company reported its results for the quarter ended September 2023 more than a month ago.

Ionis Pharmaceuticals reported revenues of $144 million in the last reported quarter, representing a year-over-year change of -10%. EPS of -$1.03 for the same period compares with -$0.33 a year ago.

For the current quarter, Ionis Pharmaceuticals is expected to post a loss of $0.99 per share, indicating a change of -167.6% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.

Ionis Pharmaceuticals has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of F.


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