It has been about a month since the last earnings report for Celgene Corporation . Shares have lost about 6% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is it 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 catalysts.
Celgene Beats on Q1 Earnings But Misses on Revenues
Celgene reported first-quarter 2017 earnings of $1.53 per share (including share-based compensation expense and tax adjustments), beating the Zacks Consensus Estimate of $1.47 and up from $1.18 per share in the year-ago quarter.
Excluding share-based compensation expense, Celgene’s earnings climbed approximately 27.3% year over year to $1.68 in the reported quarter.
Total revenue grew 17.8% to $2.96 billion in first-quarter 2017. Revenues were boosted by consistently strong performance of the company’s key growth driver, Revlimid. However, revenues were below the Zacks Consensus Estimate of $3.04 billion.
Revlimid Continues to Shine
Net product sales increased 18.2% year over year to $2.95 billion. Net sales of Revlimid came in at $1.9 billion, reflecting a year-over-year increase of 19.7%. The drug did well in the U.S. (up 23.8%). Growth in the reported quarter was driven by increased volume as a result of increases in duration and market share.
Net sales of another cancer drug, Abraxane increased 4.9% to $236 million as sales in the U.S. declined 1.4% but increased 16% internationally. Sales of oncology drug, Pomalyst/Imnovid, came in at $364 million, up 32.8%. Sales were driven by increased volume from duration gains.
Newly launched Otezla reported sales of $242 million in the reported quarter, up 23.5% driven by market share gains in the U.S. and continued launches in international markets.
All other product sales (including Istodax, Thalomid, Vidaza and an authorized generic version of Vidaza in the U.S.) totaled $224 million in the reported quarter, roughly flat.
Adjusted research and development expenses inched up 0.7% to $595 million, while adjusted selling, general and administrative expenses increased 15.2% at $539 million.
2017 Outlook Updated
For 2017, Celgene now expects earnings around $7.15–$7.30, compared to the earlier forecast of $7.10–$7.25 per share. The Zacks Consensus Estimate for earnings is $6.59. Net product sales are still expected around $13.0–$13.4 billion.
Revlimid sales are projected between $8 billion–$8.3 billion. Abraxane sales are estimated to be around $1 billion. While Pomalyst’s revenues are projected around $1.6 billion, the same for Otezla are estimated around $1.5 billion– $1.7 billion.
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
At this time, the stock has a nice Growth Score of 'B', however its Momentum is lagging a lot with a 'F'. 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 'C'. If you aren't focused on one strategy, this score is the one you should be interested in.
Based on our scores, the stock is more suitable for growth investors than those looking for value.
The stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.