A month has gone by since the last earnings report for The Medicines Company (MDCO - Free Report) . Shares have added about 4.8% in that time frame.
Will the recent positive trend continue leading up to its next earnings release, or is MDCO 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 drivers.
Medicines Company Reports Q4 Loss, Revenues Slump Y/Y
The Medicines Company reported fourth-quarter 2017 loss of $2.19 per share. The Zacks Consensus Estimate stood at a loss of $1.48.
However, excluding the impact of one-time and special items, adjusted loss per share came in at 61 cents, narrower than the year-ago loss of 78 cents.
Quarterly revenues plunged 50.6% year over year to $8.6 million. Also, the top line significantly missed the Zacks Consensus Estimate of $20 million. This downside in the reported quarter is mainly attributable to lower sales of the company’s marketed drug, Angiomax.
Quarter in Detail
Net revenues for the quarter included royalty revenues from the authorized generic sales of Angiomax by Novartis AG's generic arm, Sandoz, apart from net product sales of the drug. Total Angiomax revenues slumped 55% to $4.1 million in the quarter under review on its loss of exclusivity and increased generic competition.
The Medicines Company’s adjusted research and development (R&D) expenses (excluding the impact of one-time items) increased 21% year over year to $33.6 million on higher spend in support of inclisiran.
Adjusted selling, general and administrative (SG&A) expenses (excluding the impact of one-time items) decreased 44% to $21 million.
Full-year sales declined significantly to $44.8 million from $143.2 million a year ago. Sales substantially missed the Zacks Consensus Estimate of $80.1 million.
Full-year loss of $8.40 per share was narrower than the Zacks Consensus Estimate of a loss of $8.86. The company had incurred earnings of 28 cents in the previous year.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimate. There has been one revision lower for the current quarter. In the past month, the consensus estimate has shifted by 182.6% due to these changes.
The Medicines Company Price and Consensus
At this time, MDCO has a poor Growth Score of F, however its Momentum is doing a lot better with an A. However, the stock was allocated a grade of F on the value side, putting it in the fifth 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.
Estimates have been broadly trending downward for the stock and the magnitude of this revision indicates a downward shift. Notably, MDCO has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.