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What's in Store for These 5 Drug & Biotech Stocks in Q3 Earnings?

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The earnings season for the drug/biotech sector is now in its final lap, with some large biotech and generic drug companies due to report their third-quarter 2024 results this week.

The remaining large drugmakers have already reported their results. Many of these companies beat estimates for both earnings and sales. While some like Pfizer and AbbVie raised their guidance ranges, others like Eli Lilly & Merck cut their outlook.

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 Oct. 30, 50% of the companies in the Medical sector — representing 69.1% of the sector’s market capitalization — reported quarterly earnings. Of these, 72.4% beat on earnings and 79.3% beat on revenues. Earnings rose 23.2% year over year, while revenues grew 9.7%.

Overall, third-quarter earnings of the Medical sector are expected to increase 7% year over year, while revenues are likely to grow 9.9%.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

Here, we discuss five large biotech and generic drug companies — Novo Nordisk (NVO - Free Report) , Gilead (GILD - Free Report) , Moderna (MRNA - Free Report) , Viatris (VTRS - Free Report) and Teva Pharmaceutical Industries Limited (TEVA - Free Report) — which are set to report third-quarter 2024 results this week.

Novo Nordisk

NVO’s performance has been mixed over the trailing four quarters, with earnings beating estimates in three quarters and missing the mark once. On average, Novo Nordisk registered an earnings surprise of 3.18% in the last four quarters. In the last reported quarter, the company delivered a negative earnings surprise of 8.45%.

Novo Nordisk A/S Price and EPS Surprise

Novo Nordisk A/S Price and EPS Surprise

Novo Nordisk A/S price-eps-surprise | Novo Nordisk A/S Quote

Per our proven model, companies 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. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Novo Nordisk has an Earnings ESP of +1.02% and a Zacks Rank #3, indicating a likely positive surprise. The Zacks Consensus Estimate for earnings is pegged at 90 cents per share, while the same for revenues is $10.68 billion. Novo Nordisk will report on Nov. 6

Novo Nordisk’s revenue growth in the third quarter is expected to have been driven primarily by the strong demand for NVO’s semaglutide, a GLP-1 agonist, which is approved as an Ozempic pre-filled pen and Rybelsus oral tablet for type II diabetes and as a Wegovy injection for weight management.

Gilead

GILD’s earnings beat estimates in three of the trailing four quarters and missed the same in one, delivering an average surprise of 13.47%. In the last reported quarter, the company delivered an earnings surprise of 24.84%.

Gilead Sciences, Inc. Price and EPS Surprise

Gilead Sciences, Inc. Price and EPS Surprise

Gilead Sciences, Inc. price-eps-surprise | Gilead Sciences, Inc. Quote

Gilead has an Earnings ESP of -3.16% and a Zacks Rank #3. The Zacks Consensus Estimate for sales and earnings is pegged at $6.99 billion and $1.58 per share, respectively. Gilead will also report on Nov. 6.

Sales of Gilead’s HIV drugs Biktarvy and Descovy are likely to have increased in the third quarter. HCV sales growth is likely to have been boosted by higher demand for chronic hepatitis delta virus products and chronic hepatitis B virus products. Cell Therapy product sales are likely to have increased in the to-be-reported quarter.

Moderna

Moderna’s earnings beat estimates in the trailing four quarters, delivering an average surprise of 54.97%. In the last reported quarter, MRNA beat on earnings by 4.03%.

Moderna, Inc. Price and EPS Surprise

Moderna, Inc. Price and EPS Surprise

Moderna, Inc. price-eps-surprise | Moderna, Inc. Quote

Moderna has an Earnings ESP of -2.67% and a Zacks Rank #3. The Zacks Consensus Estimate for the top and the bottom lines is pegged at $1.25 billion and a loss of $1.91 per share, respectively. Moderna will report on Nov. 7.

Investors’ focus will likely be on the sales performance of the company's recently approved RSV vaccine mResvia, which is also the company's first product approval outside of the COVID-19 vaccine space.

Viatris

This large generic drugmaker’s earnings beat estimates in two of the trailing four quarters and missed in the other two, delivering an average negative surprise of 0.89%. In the last reported quarter, VTRS beat earnings estimates by 1.47%.

Viatris Inc. Price and EPS Surprise

Viatris Inc. Price and EPS Surprise

Viatris Inc. price-eps-surprise | Viatris Inc. Quote

Viatris has an Earnings ESP of 0.00% and a Zacks Rank #4 (Sell). The Zacks Consensus Estimate for revenues is $3.68 billion, while the same for earnings is 68 cents per share. Viatris will report on Nov. 7.

Strong growth in Emerging Markets and Japan, Australia and New Zealand (JANZ) and expansion of business activities in Greater China is likely to have boosted sales of Viatris’ Brand business. Sales from the generics business are likely to have improved on the back of strong new product launch performance in Developed Markets, continued growth from complex products and solid performance across the broader European portfolio.

Teva

Teva’s surprise history has been mixed, with the company beating earnings expectations in three of the last four quarters while missing in one, delivering an average beat of 8.62%. In the last reported quarter, Teva delivered an earnings beat of 7.02%.

Teva has an Earnings ESP of +4.35% and a Zacks Rank #2, indicating a likely positive surprise. The Zacks Consensus Estimate for earnings is pegged at 65 cents per share, while the same for revenues is $4.08 billion. Teva will report on Nov. 6.

Teva’s revenue growth in the third quarter is likely to have been driven by higher revenues from generic products globally and the branded Huntington's disease drug, Austedo.

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