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Why Is Sarepta (SRPT) Down 2.7% Since the Last Earnings Report?
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It has been about a month since the last earnings report for Sarepta Therapeutics, Inc. (SRPT - Free Report) . Shares have lost about 2.7% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is its due for a breakout? 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 drivers.
Sarepta Fourth Quarter Loss Wider than Expected
Sarepta posted a loss of $1.58 per share in the fourth quarter of 2016, wider than the year-ago loss of $1.44 as well as the Zacks Consensus Estimate of a loss of $1.26.
Loss per share excludes restructuring costs but includes the impact of share based compensation expenses and up-front license and milestone payments related to the Summit deal.
Quarterly Details
In the fourth quarter, Sarepta recorded revenues of $5.4 million, primarily due to sales of Exondys 51, which were higher than the Zacks Consensus Estimate of $5.0 million. In the prior-year quarter, Sarepta recognized revenues of $1.3 million from the finalization of the Ebola portion of the July 2010 Department of Defense contract.
Sarepta gained accelerated approval for Exondys 51 in the U.S. in Sep 2016. The company also commenced shipments of Exondys 51 at the end of the third quarter of 2016. However, the commercial launch of the drug has been slower than expected.
Slower patient starts, revenue conversions and reimbursement hurdles are being held responsible for the slower than expected launch of Exondys 51. However, Sarepta expects a pickup in patient starts and conversion rates as 2017 progresses.
Adjusted research and development (R&D) expenses were $27.8 million for the fourth quarter down 28% year over year due to lower manufacturing expenses because of the capitalization of inventory upon Exondys 51 approval. Adjusted general & administrative (G&A) expenses were 16.1 million down 22% due to lower litigation costs
Both R&D ad SG&A expenses exclude the impact of restructuring costs, share based compensation expenses and up-front license and milestone payments.
Outlook
Based on sales trends witnessed in Jan/Feb, Sarepta said it expects Exondys 51 to generate $13 million to $15 million in revenue in the first quarter of 2017, and exceed $80 million for full year. The estimates fell largely short of market expectations.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month. There have been three revisions higher for the current quarter compared to one lower. In the past month, the consensus estimate has shifted by 8.8% due to these changes.
At this time, Sarepta's stock has a poor Growth Score of 'F', however its Momentum is doing a lot better with a 'B'. However, the stock was allocated a grade of 'F' on the value side, putting it in the bottom 20% 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.
The company's stock is suitable solely for momentum based on our styles scores.
Outlook
Estimates have been trending upward for the stock. The magnitude of these revisions also looks promising. Interestingly the stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.
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Why Is Sarepta (SRPT) Down 2.7% Since the Last Earnings Report?
It has been about a month since the last earnings report for Sarepta Therapeutics, Inc. (SRPT - Free Report) . Shares have lost about 2.7% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is its due for a breakout? 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 drivers.
Sarepta Fourth Quarter Loss Wider than Expected
Sarepta posted a loss of $1.58 per share in the fourth quarter of 2016, wider than the year-ago loss of $1.44 as well as the Zacks Consensus Estimate of a loss of $1.26.
Loss per share excludes restructuring costs but includes the impact of share based compensation expenses and up-front license and milestone payments related to the Summit deal.
Quarterly Details
In the fourth quarter, Sarepta recorded revenues of $5.4 million, primarily due to sales of Exondys 51, which were higher than the Zacks Consensus Estimate of $5.0 million. In the prior-year quarter, Sarepta recognized revenues of $1.3 million from the finalization of the Ebola portion of the July 2010 Department of Defense contract.
Sarepta gained accelerated approval for Exondys 51 in the U.S. in Sep 2016. The company also commenced shipments of Exondys 51 at the end of the third quarter of 2016. However, the commercial launch of the drug has been slower than expected.
Slower patient starts, revenue conversions and reimbursement hurdles are being held responsible for the slower than expected launch of Exondys 51. However, Sarepta expects a pickup in patient starts and conversion rates as 2017 progresses.
Adjusted research and development (R&D) expenses were $27.8 million for the fourth quarter down 28% year over year due to lower manufacturing expenses because of the capitalization of inventory upon Exondys 51 approval. Adjusted general & administrative (G&A) expenses were 16.1 million down 22% due to lower litigation costs
Both R&D ad SG&A expenses exclude the impact of restructuring costs, share based compensation expenses and up-front license and milestone payments.
Outlook
Based on sales trends witnessed in Jan/Feb, Sarepta said it expects Exondys 51 to generate $13 million to $15 million in revenue in the first quarter of 2017, and exceed $80 million for full year. The estimates fell largely short of market expectations.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month. There have been three revisions higher for the current quarter compared to one lower. In the past month, the consensus estimate has shifted by 8.8% due to these changes.
Sarepta Therapeutics, Inc. Price and Consensus
Sarepta Therapeutics, Inc. Price and Consensus | Sarepta Therapeutics, Inc. Quote
VGM Scores
At this time, Sarepta's stock has a poor Growth Score of 'F', however its Momentum is doing a lot better with a 'B'. However, the stock was allocated a grade of 'F' on the value side, putting it in the bottom 20% 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.
The company's stock is suitable solely for momentum based on our styles scores.
Outlook
Estimates have been trending upward for the stock. The magnitude of these revisions also looks promising. Interestingly the stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.