It has been about a month since the last earnings report for Celgene Corporation . Shares have added about 6% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock’s next earnings release, or is it 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 catalysts.
Celgene Misses on Earnings & Revenues, View Unchanged
Celgene reported fourth-quarter 2016 earnings of $1.41 per share (including share-based compensation expense and tax adjustments), missing the Zacks Consensus Estimate of $1.43 but up from $1.02 per share in the year-ago quarter.
Excluding share-based compensation expense, Celgene’s earnings climbed approximately 36.4% year over year to $1.61 in the reported quarter.
Total revenue soared 16.3% to $2.98 billion in the fourth quarter of 2016. Revenues were boosted by a consistently strong performance by the company’s key growth driver, Revlimid. However, revenues were below the Zacks Consensus Estimate of $3.0 billion.
Revlimid Continues to Shine
Net product sales increased 17.2% year over year to $2.98 billion, including a 0.3% negative impact from currency movement.
Net sales of Revlimid came in at $1.8 billion, reflecting a year-over-year increase of 15.9%. The drug did well in the U.S. (up 24.2%). Growth in the reported quarter was driven by new patient market share gains and longer duration.
Net sales of another cancer drug, Abraxane, declined 1.4% to $266.1 million. Sales of oncology drug, Pomalyst/Imnovid, came in at $377.9 million, up 28.6%. Sales were driven by increased volume from duration gains.
Newly launched Otezla reported sales of $305 million in the reported quarter, up 67%. Sales benefited from increased contribution from early launch in European countries.
All other product sales (including Istodax, Thalomid, Vidaza and an authorized generic version of Vidaza in the U.S.) totaled $220 million in the fourth quarter, down 4.8%.
Adjusted research and development expenses increased approximately 3.7% to $673 million, while adjusted selling, general and administrative expenses were roughly flat at $534 million.
2017 Outlook
For 2017, Celgene expects earnings around $7.10 to $7.25 per share. The Zacks Consensus Estimate for earnings stands at $6.55. Net product sales are expected around $13.0–$13.4 billion.
Revlimid sales are projected between $8 billion - $8.3 billion. Abraxane sales are still estimated to be around $1 billion.
The guidance maintained was in line with the one issued with the preliminary results released earlier in the month.
Delina Acquisition
Concurrent with the results, Celgene Corporation announced that it will acquire privately-held biotechnology company Delinia, Inc. The transaction will expand Celgene's Inflammation and Immunology pipeline with the addition of Delinia's lead program, DEL106 along with other second generation programs.
As per the terms of the agreement, Celgene will make an initial payment of $300 million and amilestone payments of $475 million as and when they accrue. The transaction is anticipated to close in the first quarter of 2017.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last one month period as none of them issued any earnings estimate revisions.
VGM Scores
At this time, Celgene's stock has a strong Growth Score of 'A', though it is lagging a lot on the momentum front with an 'D'. However, the stock was allocated a grade of 'C' on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregte VGM Score of 'B'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is more suitable for growth investors than value investors.
Outlook
The stock has a Zacks Rank #2 (Buy). We are expecting an above average return from the stock in the next few months.
Image: Bigstock
Why Is Celgene (CELG) Up 6% Since the Last Earnings Report?
It has been about a month since the last earnings report for Celgene Corporation . Shares have added about 6% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock’s next earnings release, or is it 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 catalysts.
Celgene Misses on Earnings & Revenues, View Unchanged
Celgene reported fourth-quarter 2016 earnings of $1.41 per share (including share-based compensation expense and tax adjustments), missing the Zacks Consensus Estimate of $1.43 but up from $1.02 per share in the year-ago quarter.
Excluding share-based compensation expense, Celgene’s earnings climbed approximately 36.4% year over year to $1.61 in the reported quarter.
Total revenue soared 16.3% to $2.98 billion in the fourth quarter of 2016. Revenues were boosted by a consistently strong performance by the company’s key growth driver, Revlimid. However, revenues were below the Zacks Consensus Estimate of $3.0 billion.
Revlimid Continues to Shine
Net product sales increased 17.2% year over year to $2.98 billion, including a 0.3% negative impact from currency movement.
Net sales of Revlimid came in at $1.8 billion, reflecting a year-over-year increase of 15.9%. The drug did well in the U.S. (up 24.2%). Growth in the reported quarter was driven by new patient market share gains and longer duration.
Net sales of another cancer drug, Abraxane, declined 1.4% to $266.1 million. Sales of oncology drug, Pomalyst/Imnovid, came in at $377.9 million, up 28.6%. Sales were driven by increased volume from duration gains.
Newly launched Otezla reported sales of $305 million in the reported quarter, up 67%. Sales benefited from increased contribution from early launch in European countries.
All other product sales (including Istodax, Thalomid, Vidaza and an authorized generic version of Vidaza in the U.S.) totaled $220 million in the fourth quarter, down 4.8%.
Adjusted research and development expenses increased approximately 3.7% to $673 million, while adjusted selling, general and administrative expenses were roughly flat at $534 million.
2017 Outlook
For 2017, Celgene expects earnings around $7.10 to $7.25 per share. The Zacks Consensus Estimate for earnings stands at $6.55. Net product sales are expected around $13.0–$13.4 billion.
Revlimid sales are projected between $8 billion - $8.3 billion. Abraxane sales are still estimated to be around $1 billion.
The guidance maintained was in line with the one issued with the preliminary results released earlier in the month.
Delina Acquisition
Concurrent with the results, Celgene Corporation announced that it will acquire privately-held biotechnology company Delinia, Inc. The transaction will expand Celgene's Inflammation and Immunology pipeline with the addition of Delinia's lead program, DEL106 along with other second generation programs.
As per the terms of the agreement, Celgene will make an initial payment of $300 million and amilestone payments of $475 million as and when they accrue. The transaction is anticipated to close in the first quarter of 2017.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last one month period as none of them issued any earnings estimate revisions.
Celgene Corporation Price and Consensus
Celgene Corporation Price and Consensus | Celgene Corporation Quote
VGM Scores
At this time, Celgene's stock has a strong Growth Score of 'A', though it is lagging a lot on the momentum front with an 'D'. However, the stock was allocated a grade of 'C' on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregte VGM Score of 'B'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is more suitable for growth investors than value investors.
Outlook
The stock has a Zacks Rank #2 (Buy). We are expecting an above average return from the stock in the next few months.