It has been about a month since the last earnings report for Xenon Pharmaceuticals (XENE Quick QuoteXENE - Free Report) . Shares have added about 2.4% in that time frame, outperforming the S&P 500.

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

Xenon Q3 Loss Narrower Than Expected, Pipeline Development in Focus

Xenonreported a loss of 81 cents per share for the third quarter of 2024, narrower than the Zacks Consensus Estimate of a loss of 82 cents. The company had incurred a loss of 73 cents per share in the year-ago quarter.

In the reported quarter, Xenon did not generate any revenues. Due to the absence of a marketed product, the company only recognizes periodic collaboration revenues in its top line from its ongoing partnership with Neurocrinefor XEN901, now known as NBI-921352. The company did not recognize any revenues in the year-ago quarter as well. 

XENE’s Q3 Results in Detail

In the third quarter of 2024, research and development (R&D) expenses increased 33% to $57 million compared with $42.9 million in the year-ago period. The uptick was primarily due to increased expenses related to the company’s azetukalner late-stage epilepsy studies, as well as pre-clinical and discovery programs to advance multiple potential drug candidates.

General and administrative expenses were $16.7 million in the reported quarter, up 30% year over year. The significant rise was on the grounds of increased personnel-related costs due to higher employee headcount and stock-based compensation expenses.

Xenon had cash, cash equivalents and marketable securities worth $803.3 million as of Sept. 30, 2024, compared with $850.6 million as of June 30, 2024. The company expects its existing cash balance to fundits current operating plans,which include the completion of the azetukalner phase III epilepsy studies and fully supporting late-stage clinical development of azetukalner in MDD into 2027.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in fresh estimates.

VGM Scores

At this time, Xenon Pharmaceuticals has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. However, the stock was allocated a grade of F on the value side, putting it in the fifth 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

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions has been net zero. Notably, Xenon Pharmaceuticals 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

Xenon Pharmaceuticals is part of the Zacks Medical - Biomedical and Genetics industry. Over the past month, Geron (GERN Quick QuoteGERN - Free Report) , a stock from the same industry, has gained 2.8%. The company reported its results for the quarter ended September 2024 more than a month ago.

Geron reported revenues of $28.27 million in the last reported quarter, representing a year-over-year change of +17568.8%. EPS of -$0.04 for the same period compares with -$0.08 a year ago.

For the current quarter, Geron is expected to post a loss of $0.02 per share, indicating a change of +77.8% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.

Geron 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.