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Can Amgen (AMGN) Keep the Beat Streak Alive in Q4 Earnings?
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We expect Amgen (AMGN - Free Report) to beat expectations when it reports fourth-quarter and full-year 2023 results on Feb 6, after market close. In the last reported quarter, the company delivered an earnings surprise of 6.67%.
Factors to Consider
Amgen’s product sales are expected to have been driven by strong volume growth of products like Evenity, Repatha, Prolia and Blincyto, among others. However, the prices of most products are expected to have declined.
The Zacks Consensus Estimate for Prolia, Repatha, Evenity and Blincyto sales is pegged at $1.05 billion, $428.0 million, $319.0 million and $227.0 million, respectively.
Our estimates for Prolia, Repatha, Evenity and Blincyto sales are pegged at $1.03 billion, $426.5 million, 318.2 million and $223.2 million, respectively.
In addition, higher volumes of newer drugs like Tezspire and Tavneos are expected to have contributed to top-line growth driven by new patient volume growth. Sales of both Tezspire and Tavneos improved sequentially in the third quarter, a trend expected to have continued in the fourth quarter. Like the previous two quarters, Tezspire volumes are likely to have benefitted from the launch of a self-administered, pre-filled, single-use pen formulation of the drug in the first quarter, improving patient convenience and accessibility and also providing more flexibility in treatment options.
Our estimates for Tezspire and Tavneos are pegged at $177.1 million and $47.0 million, respectively.
However, lower revenues from oncology biosimilars (Kanjinti and Mvasi) and legacy established products are expected to have hurt the top line. In addition, in the first three quarters of 2023, sales of Otezla in the United States were hurt by free drug programs launched by new competitors and lower pricing.
On the third-quarter conference call, Amgen had said that it is seeing reduced impact of the free drug programs. Amgen is also making investments to educate physicians about the benefits of Otezla for appropriate patients and has increased the Otezla sales force by 20%. It remains to be seen if these initiatives led to any improvement in sales of Otezla.
The Zacks Consensus Estimate for Otezla is $618.0 million, while our estimate is $606.4 million.
For Enbrel, improved payer coverage led to an increase in new patients, boosting volume growth in the last two quarters. The positive trend is expected to have continued in the fourth quarter. However, lower pricing is expected to have hurt sales of this legacy established product. The Zacks Consensus Estimate as well as our model estimate for Enbrel is $1.06 billion.
In October 2023, Amgen closed the previously announced acquisition of Horizon Therapeutics for $27.8 billion. The addition of Horizon Therapeutics has added several rare disease drugs like Tepezza, Krystexxa and Uplizna to Amgen’s portfolio. Amgen's fourth-quarter results will include sales of all these drugs.
Adjusted EPS in the fourth quarter is expected to be lower than the third quarter due to increased investments in pipeline candidates like maridebart cafraglutide, olpasiran and AMG 193. In addition, the recognition of interest expense related to Horizon financing will also hurt earnings per share in the fourth quarter.
Earnings Surprise History
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 6.04%, on average.
Amgen’s stock has risen 23.9% in the past year against a decrease of 14.1% for the industry.
Image Source: Zacks Investment Research
Earnings Whispers
Our proven model predicts an earnings beat for Amgen in the to-be-reported quarter. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for a likely positive surprise. This is the case here, as elaborated below.
Earnings ESP: Amgen’s Earnings ESP is +1.01% as the Most Accurate Estimate of $4.74 is higher than the Zacks Consensus Estimate of $4.68. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Amgen has a Zacks Rank #3.
Other Stocks to Consider
Here are some large drug/biotech stocks that have the right combination of elements to beat on earnings this time around:
Novartis (NVS - Free Report) has an Earnings ESP of +3.39% and a Zacks Rank #3.
Novartis’ stock has risen 19.5% in the past year. Novartis topped earnings estimates in the last four quarters. NVS delivered a four-quarter earnings surprise of 6.99%, on average. Novartis is scheduled to release its fourth-quarter results on Jan 31.
AstraZeneca’s stock has risen 1.9% in the past year. AstraZeneca beat earnings estimates in the last four quarters. AZN has a four-quarter earnings surprise of 8.30%, on average. AstraZeneca is scheduled to release its fourth-quarter results on Feb 8.
Sanofi (SNY - Free Report) has an Earnings ESP of +13.01% and a Zacks Rank #3.
Sanofi’s stock has risen 3.2% in the past year. Sanofi beat earnings estimates in three of the last four quarters while missing in one. SNY has a four-quarter earnings surprise of 2.88%, on average. Sanofi is scheduled to release its fourth-quarter results on Feb 1.
Image: Bigstock
Can Amgen (AMGN) Keep the Beat Streak Alive in Q4 Earnings?
We expect Amgen (AMGN - Free Report) to beat expectations when it reports fourth-quarter and full-year 2023 results on Feb 6, after market close. In the last reported quarter, the company delivered an earnings surprise of 6.67%.
Factors to Consider
Amgen’s product sales are expected to have been driven by strong volume growth of products like Evenity, Repatha, Prolia and Blincyto, among others. However, the prices of most products are expected to have declined.
The Zacks Consensus Estimate for Prolia, Repatha, Evenity and Blincyto sales is pegged at $1.05 billion, $428.0 million, $319.0 million and $227.0 million, respectively.
Our estimates for Prolia, Repatha, Evenity and Blincyto sales are pegged at $1.03 billion, $426.5 million, 318.2 million and $223.2 million, respectively.
In addition, higher volumes of newer drugs like Tezspire and Tavneos are expected to have contributed to top-line growth driven by new patient volume growth. Sales of both Tezspire and Tavneos improved sequentially in the third quarter, a trend expected to have continued in the fourth quarter. Like the previous two quarters, Tezspire volumes are likely to have benefitted from the launch of a self-administered, pre-filled, single-use pen formulation of the drug in the first quarter, improving patient convenience and accessibility and also providing more flexibility in treatment options.
Our estimates for Tezspire and Tavneos are pegged at $177.1 million and $47.0 million, respectively.
However, lower revenues from oncology biosimilars (Kanjinti and Mvasi) and legacy established products are expected to have hurt the top line. In addition, in the first three quarters of 2023, sales of Otezla in the United States were hurt by free drug programs launched by new competitors and lower pricing.
On the third-quarter conference call, Amgen had said that it is seeing reduced impact of the free drug programs. Amgen is also making investments to educate physicians about the benefits of Otezla for appropriate patients and has increased the Otezla sales force by 20%. It remains to be seen if these initiatives led to any improvement in sales of Otezla.
The Zacks Consensus Estimate for Otezla is $618.0 million, while our estimate is $606.4 million.
For Enbrel, improved payer coverage led to an increase in new patients, boosting volume growth in the last two quarters. The positive trend is expected to have continued in the fourth quarter. However, lower pricing is expected to have hurt sales of this legacy established product. The Zacks Consensus Estimate as well as our model estimate for Enbrel is $1.06 billion.
In October 2023, Amgen closed the previously announced acquisition of Horizon Therapeutics for $27.8 billion. The addition of Horizon Therapeutics has added several rare disease drugs like Tepezza, Krystexxa and Uplizna to Amgen’s portfolio. Amgen's fourth-quarter results will include sales of all these drugs.
Adjusted EPS in the fourth quarter is expected to be lower than the third quarter due to increased investments in pipeline candidates like maridebart cafraglutide, olpasiran and AMG 193. In addition, the recognition of interest expense related to Horizon financing will also hurt earnings per share in the fourth quarter.
Earnings Surprise History
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 6.04%, on average.
Amgen Inc. Price and EPS Surprise
Amgen Inc. price-eps-surprise | Amgen Inc. Quote
Amgen’s stock has risen 23.9% in the past year against a decrease of 14.1% for the industry.
Image Source: Zacks Investment Research
Earnings Whispers
Our proven model predicts an earnings beat for Amgen in the to-be-reported quarter. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for a likely positive surprise. This is the case here, as elaborated below.
Earnings ESP: Amgen’s Earnings ESP is +1.01% as the Most Accurate Estimate of $4.74 is higher than the Zacks Consensus Estimate of $4.68. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Amgen has a Zacks Rank #3.
Other Stocks to Consider
Here are some large drug/biotech stocks that have the right combination of elements to beat on earnings this time around:
Novartis (NVS - Free Report) has an Earnings ESP of +3.39% and a Zacks Rank #3.
Novartis’ stock has risen 19.5% in the past year. Novartis topped earnings estimates in the last four quarters. NVS delivered a four-quarter earnings surprise of 6.99%, on average. Novartis is scheduled to release its fourth-quarter results on Jan 31.
AstraZeneca (AZN - Free Report) has an Earnings ESP of +3.17% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
AstraZeneca’s stock has risen 1.9% in the past year. AstraZeneca beat earnings estimates in the last four quarters. AZN has a four-quarter earnings surprise of 8.30%, on average. AstraZeneca is scheduled to release its fourth-quarter results on Feb 8.
Sanofi (SNY - Free Report) has an Earnings ESP of +13.01% and a Zacks Rank #3.
Sanofi’s stock has risen 3.2% in the past year. Sanofi beat earnings estimates in three of the last four quarters while missing in one. SNY has a four-quarter earnings surprise of 2.88%, on average. Sanofi is scheduled to release its fourth-quarter results on Feb 1.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.