The bulk of the Q3 earnings season is over, with 364 S&P 500 members (as of Nov 2) – accounting for 72.6% of the index’s total market capitalization – having already reported results, according to the latest Earnings Outlook.
While total earnings for these index members were up 1.6% from the year-ago quarter, revenues were also up 1.6% year over year. The beat ratio was 72.3% for earnings and 54.7% for revenues.
Notably, the ongoing reporting cycle is on track to be the first quarter of positive earnings growth after five consecutive quarters of earnings decline for the S&P 500 index. However, though the third-quarter reporting cycle saw numerous positive surprises and stability in current-quarter (Q4 2016) estimates in the beginning, these two attributes have started losing ground this week. Positive surprises, particularly on the revenue side, have become harder to come by and Q4 estimates are moving down.
This change was reflected in the results of pharmaceutical companies as well. Though quite a few of the large-cap pharma companies posted better-than-expected third-quarter results last week, three large pharma companies that have reported so far this week – Allergan plc’s (AGN - Free Report) , Gilead Sciences Inc. (GILD - Free Report) and Pfizer Inc. (PFE - Free Report) – announced softer-than-expected Q3 results. While Allergan and Pfizer missed estimates for both earnings and sales, Gilead’s third-quarter earnings fell short of expectations while revenues just about surpassed expectations.
Four more companies from the healthcare sector are set to report their quarterly results on Nov 7. Let's see how things are shaping up for their respective announcements.
Horizon Pharma plc (HZNP - Free Report)
Horizon Pharma is scheduled to report third-quarter 2016 results before the opening bell. The company posted a negative surprise of 20.75% in the last reported quarter. Horizon’s performance has been far from encouraging with the company missing earnings estimates thrice and surpassing the same in one out of the four trailing quarters. Overall, the company has an average negative earnings surprise of 1.85%.
Last month, Horizon provided sales and EBITDA expectations for the third quarter of 2016. Including the impact of the $65 million settlement inked with pharmacy benefit manager (PBM) Express Scripts Holding Company in late September, Horizon expects to record third-quarter net sales in the range of $207–$209 million. Third-quarter EBITDA is projected in the range of $139–$141 million. (Read More: Horizon Q3 Earnings Preview: Stock to Disappoint?).
The Zacks Consensus Estimate for the quarter is pegged at 63 cents per share. The company has a Zacks Rank #3 (Hold) and an Earnings ESP of 0.00%.
ACADIA Pharmaceuticals Inc. (ACAD - Free Report)
ACADIA Pharmaceuticals is expected to report third-quarter 2016 results after market close. The company posted a negative surprise of 31.25% in the last reported quarter. In the four trailing quarters, the company missed estimates thrice, bringing the average negative earnings surprise to 15.72%.
Nuplazid, a new drug launched in May, generated revenues of $0.1 million in the second quarter and sales are expected to pick up in the third quarter. (Read More: ACADIA Pharma: Will It Disappoint in Q3 Earnings?).
The Zacks Consensus Estimate for the quarter is pegged at a loss of 55 cents per share. The company has a Zacks Rank #3 and an Earnings ESP of +5.46%, indicating a likely positive surprise. Please check our Earnings ESP Filter that enables you find stocks that are expected to come out with earnings surprises.
Our previous article showed ACADIA Pharmaceuticals as unlikely to beat on earnings this time around. However, estimates changed thereafter and we are reasonably confident about an earnings beat.
Catalent, Inc. (CTLT - Free Report)
Catalent is expected to report first-quarter fiscal 2017 results after market close.
Last quarter, the company delivered a negative earnings surprise of 3.77%. Catalent hasa dismal track record for the last four quarters. The company surpassed expectations only once, while missed in the remaining two quarters, with the average negative earnings surprise being 17.41%.
The Zacks Consensus Estimate for the quarter is pegged at 13 cents per share. The company has an Earnings ESP of -7.69% and a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Ultragenyx Pharmaceutical Inc. (RARE - Free Report)
Ultragenyx Pharma is expected to report third-quarter 2016 results after market close.
Last quarter, the company delivered a positive earnings surprise of 0.68%. Ultragenyx Pharma has a dismal track record for the last four quarters. The company surpassed expectations only once, while missed in the remaining three quarters, with the average negative earnings surprise being 13.27%.
The Zacks Consensus Estimate for the quarter is pegged at a loss of $1.56 per share. The company has an Earnings ESP of 0.00% and a Zacks Rank #2.
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