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Sucampo (SCMP) Up 17.1% Since Earnings Report: Can It Continue?

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It has been more than a month since the last earnings report for Sucampo Pharmaceuticals, Inc. (SCMP - Free Report) . Shares have added about 17.1% in that tiem 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 its most recent earnings report in order to get a better handle on the important catalysts.

Sucampo Q2 Earnings & Revenues Beat Estimates, Up Y/Y

Sucampo reported adjusted earnings of $0.28 per share in the second quarter of 2017, beating the Zacks Consensus Estimate of $0.22. Reported earnings were also up 16.67% from the year-ago figure of $0.24 cents.

Total revenue came in at $59.9 million, up 15.2% from the year-ago quarter, and surpassed the Zacks Consensus Estimate of $57.08 million, driven by higher Amitiza sales in Japan.

Quarter in Detail

Product sales were $34.2 million, up 20.4% year over year. Product royalty revenues were $20.56 million, up 9.7% year over year.

Sales of Amitiza, Sucampo's marketed product, as reported by Takeda Pharmaceutical for royalty calculation purposes, in the U.S. were $110.7 million, up 9%. Takeda holds the global marketing rights for Amitiza outside Japan and China and pays royalties to Sucampo. Total prescriptions for the product in the U.S. were down 4%. As reported by Mylan, Amitiza sales increased 27% to $18.6 million in Japan. Unit volume increased 24%.

The company’s operational expense (R&D and S&GA) increased 34% from the year-ago period to $32.1 million, which includes a milestone payment of $4.5 million to Cancer Prevention Pharmaceuticals and inclusion of research & development expense related to Vtesse.

Subsequent to the quarter in Jul 2017, the company filed a supplemental new drug application (sNDA) with the FDA for label expansion of Amitiza to include pediatric patients (10-17 year of age) suffering from functional constipation. The sNDA was filed based on supporting data and evident efficacy in this age group.

2017 Guidance Reiterated

Sucampo reiterated its guidance for full year 2017. The company expects total revenue in the range of $220 million to $230 million. The Zacks Consensus Estimate for 2017 is $234.85 million.

The company expects adjusted net income in the range of $56 million to $66 million, and adjusted earnings in the range of $1.00 to $1.10.

How Have Estimates Been Moving Since Then?

Analysts were quiet during the past month as none of them issued any earnings estimate revisions.

VGM Scores

At this time, the stock has a nice Growth Score of B, a grade with the same score on the momentum front. Charting the exact same path, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. 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 equally suitable for momentum, growth and value investors.

Outlook

The stock has a Zacks Rank #4 (Sell). We are expecting a below average return from the stock in the next few months.




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