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Medicines Company (MDCO) Up 11.4% Since Earnings Report: Can It Continue?

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It has been about a month since the last earnings report for The Medicines Company (MDCO - Free Report) . Shares have added about 11.4% 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 catalysts.

Medicines Company’s Q1 Loss Widens, Revenues Tank Y/Y

The Medicines Company incurred first-quarter 2018 loss of 76 cents per share, wider than the Zacks Consensus Estimate of a loss of 71 cents and the year-ago figure of a loss of 75 cents.

Quarterly revenues plunged 55.4% year over year to $7.8 million. Also, the top line missed the Zacks Consensus Estimate of $9 million. This downside in the quarter under review is mainly attributable to lower sales of the company’s marketed drug, Angiomax.

Adjusted research and development (R&D) expenses (excluding the impact of one-time items) increased 51% year over year to $39.1 million on higher spend in support of inclisiran.

Adjusted selling, general and administrative (SG&A) expenses (excluding the impact of one-time items) declined 41% to $21.4 million.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in fresh estimates. There have been three revisions lower for the current quarter.

The Medicines Company Price and Consensus

 

The Medicines Company Price and Consensus | The Medicines Company Quote

VGM Scores

At this time, MDCO has a subpar Growth Score of D, though it is lagging a bit on the momentum front with an F. The stock was also allocated a grade of F on the value side, putting it in the bottom 20% 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.

Our style scores indicate investors will probably be better served looking elsewhere.

Outlook

Estimates have been broadly trending downward for the stock and the magnitude of these revisions looks promising. Notably, MDCO has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.




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