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Why Is Infinity Pharmaceuticals (INFI) Down 18.3% Since its Last Earnings Report?

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A month has gone by since the last earnings report for Infinity Pharmaceuticals, Inc. (INFI - Free Report) . Shares have lost about 18.3% in that time frame.

Will the recent negative trend continue leading up to its next earnings release, or is INFI 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.

Infinity Reports Narrower-Than-Expected Loss in Q4

Infinity reported a loss of 14 cents per share in fourth-quarter 2017, narrower than the Zacks Consensus Estimate of a loss of 27 cents. The company had reported a loss of 46 cents in the year-ago quarter.

Since Infinity does not have any approved product in its portfolio, the company earns revenues in the form of royalties, license and milestone payments as well as research and development (R&D) support fees paid by its partners.

Quarter in Detail

In the quarter, R&D expenses plummeted to $3.6 million from $14.7 million in the year-ago quarter. The decline was mainly due to the company's 2016 restructuring activities and out-licensing of duvelisib to Verastem Inc.

General and administrative (G&A) expenses were $4.5 million for the quarter, down from $8.6 million in the year-ago quarter. The decrease was mainly due to the company's 2016 restructuring activities.

2018 Outlook

Infinity expects net loss for 2018 to be in the range of $35-$40 million. The company anticipates year-end cash and cash equivalents and available-for-sale securities balance in the $15-$25 million range. Moreover, Infinity expects that its existing cash, cash equivalents and available-for-sale securities as of Dec 31, 2017 should be adequate to fund the company's capital needs through third-quarter 2019.

2017 Results

The company reported a loss of 83 cents in 2017 compared with a loss of 61 cents in 2016.

Collaboration revenues in 2017 came in at $6 million, down from $18.7 million in 2016.

Other Updates

Infinity is evaluating IPI-549 as a monotherapy and in combination with Bristol-Myers’ Opdivo in a phase I study in patients with advanced solid tumors.

The phase I/Ib monotherapy and combination dose escalation components of the study have been completed and the monotherapy expansion component has been fully enrolled. Further, six disease-specific combination expansion cohorts are enrolling at the recommended phase II dose of 40 mg once daily of IPI-549 plus Opdivo at 240 mg every two weeks in patients with non-small cell lung cancer, melanoma, head and neck cancer, triple-negative breast cancer, mesothelioma, and adrenocortical carcinoma.

An additional combination expansion cohort of patients pre-selected for having high baseline blood levels of myeloid derived suppressor cells is expected to open for enrollment in the next few weeks.

In November 2017, Infinity announced updated data from the monotherapy dose-escalation component of the Phase I/Ib study of IPI-549 at the SITC Annual Meeting 2017. These data demonstrated that IPI-549 dosed once daily was well tolerated and clinically active.

The company believes that IPI-549 has the potential to increase the number of patients who respond to immunotherapies as well as to increase the duration of those responses.

The company expects to report data from the monotherapy expansion and combination dose escalation components of its study and from seven combination expansion cohorts which will help define the development and regulatory strategy for IPI-549.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in fresh estimates. There has been one revision higher for the current quarter.

Infinity Pharmaceuticals, Inc. Price and Consensus

VGM Scores

Currently, INFI 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 lowest 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 and the magnitude of this revision looks promising. It comes with little surprise INFI has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.




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