Halozyme Therapeutics (HALO Quick QuoteHALO - Free Report) is scheduled to report third-quarter 2025 results on Nov. 3, after market close. The Zacks Consensus Estimate for sales and earnings for the third quarter is pegged at $336.9 million and $1.62 per share, respectively. Earnings estimates for 2025 have increased from $6.01 to $6.18 per share over the past 60 days.

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HALO's Earnings Surprise History

Halozyme has an encouraging history of earnings surprises. The company beat on earnings in each of the trailing four quarters, delivering an average surprise of 19.74%. In the last reported quarter, HALO posted an earnings surprise of 25.20%.

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What Does Our Model Say for HALO?

Our proven model predicts an earnings beat for Halozyme this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is the case here, as you will see below. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.

Halozyme has an Earnings ESP of +2.53% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Factors Shaping HALO’s Upcoming Results

Halozyme has collaboration agreements with large pharma companies that use its novel drug delivery technology, ENHANZE, for the development of subcutaneous (SC) formulations of their currently marketed drugs. These agreements generate royalties on sales of marketed drugs, milestone payments and annual license fees, which comprise Halozyme’s top line.

Halozyme has eight marketed partnered drugs based on this technology, including the SC formulation of J&J’s (JNJ Quick QuoteJNJ - Free Report) Darzalex and Roche’s (RHHBY Quick QuoteRHHBY - Free Report) Phesgo.

Halozyme’s top line in the third quarter is likely to have been driven by higher royalty payments from Roche for Phesgo and J&J for SC Darzalex as well as argenx’s Vyvgart Hytrulo, due to robust demand. Our model estimates Halozyme's revenues from royalties to increase at a CAGR of 23.2% over the next three years.

Halozyme has two commercial proprietary products, Hylenex and Xyosted, with the latter acquired from Antares Pharma in 2022. Incremental sales from these products are also likely to have boosted Halozyme’s revenues during the upcoming quarter.

Revenues under collaborative agreements increased substantially in the last reported quarter, a trend most likely to have continued in the third quarter as well.

HALO’s Recent Key Developments

Halozyme recently entered into a definitive agreement to acquire Elektrofi, a biopharmaceutical company known for its ultra-high concentration microparticle technology for biologics, branded as Hypercon.

The transaction is expected to be closed later in the fourth quarter of 2025 and is likely to expand and diversify Halozyme’s drug delivery technology offerings for continued long-term revenue growth into 2040.

Per the deal, Halozyme will make an upfront payment of $750 million to Elektrofi, with up to three additional milestone payments of $50 million each, contingent upon regulatory approvals for three separate products.

Simultaneously with the Elektrofi Deal, Halozyme reaffirmed the 2025 revenue guidance that it had provided earlier in August.

The company continues to expect total revenues in the range of $1.28 billion to $1.36 billion, while royalty revenues are anticipated in the range of $825-$860 million. Adjusted EBITDA is expected in the band of $865-$915 million. Adjusted EPS is expected in the range of $6.00-$6.40 in 2025.

Investors will be keen to know whether the company increases the guidance further or maintains it on the upcoming earnings call.

HALO’s Stock Price Performance & Valuation

Year to date, shares of Halozyme have rallied 38.4% compared with the industry’s rise of 9.3%. The stock has also outperformed the sector and the S&P 500 during the same time frame, as seen in the chart below.

HALO Stock Outperforms Industry, Sector & S&P 500

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From a valuation standpoint, Halozyme is trading at a premium to the industry. Going by the price-to-sales (P/S) ratio, the stock currently trades at 6.97 times trailing 12-month sales value, higher than 2.26 times for the industry. The stock is trading below its five-year mean of 8.41.

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Our Investment Thesis on HALO Stock

Halozyme holds a strong financial position, with $548 million in cash (as of June 2025) and no near-term outstanding debt, providing enough liquidity to fund ongoing operations.

Higher royalties from its partners should continue to boost the top line, while incremental contributions from its proprietary products should aid revenues during the third quarter. The recent Elektrofi Deal should help the company diversify its drug delivery technology offerings and drive long-term growth.

However, Halozyme’s heavy reliance on partners for income through royalties and collaborations remains a concern. In addition, many of its partnered products face strong competition in the United States, including from biosimilars.

Stay Invested in HALO's Stock

Though Halozyme is trading at a premium compared to the industry, the company has growth potential. The rising estimates reflect analysts’ optimistic outlook for the stock.

We believe Halozyme is a good stock to have in one’s portfolio as of now, based on its strong overall financial performance. Those who already own the stock may retain it for some time to see if the company can sustain its strong first-half performance into the second half.