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Acorda (ACOR) Up 13.4% Since Earnings Report: Can It Continue?

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A month has gone by since the last earnings report for Acorda Therapeutics, Inc. (ACOR - Free Report) . Shares have added about 13.4% in that time frame.

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

Acorda Q1 Earnings Miss Estimates, Sales Down Y/Y

Acorda reported adjusted earnings of 14 cents per share in the first quarter of 2018, which significantly missed the Zacks Consensus Estimate of 73 cents. However, the company incurred a loss of 8 cents a year ago.

Total revenues came in at $106.2 million, missing the Zacks Consensus Estimate of $126 million by 18.8%. Moreover, sales declined 11.1% year over year due to lower net product as well as royalty revenues.

Quarter in Detail

Majority of Acorda’s net product revenues were generated by the company’s key drug Ampyra, which raked in sales of $102.8 million in the reported quarter. Revenues decreased around 8.2% year over year and 35.3%, sequentially. This fall can mainly be attributed to modest inventory levels during the fourth quarter of 2017, which normalized by the end of the first quarter of 2018.

Notably, in the quarter under review, royalty revenues declined 28.9% to $3.2 million from the year-ago figure of $4.5 million.

Acorda’s research and development (R&D) expenses dropped 34.3% year over year to $28.9 million owing to corporate restructuring, which occurred in 2017.

Selling, general and administrative (SG&A) expenses also lowered 5.7% to $43.4 million.

2018 Guidance

The company maintained its Ampyra net sales view for 2018 in the range of $330-$350 million. This is lower than the Ampyra full year 2017 revenue of $543.3 million due to the expected generic entry of the drug in the United States in July, 2018.

The company continues to project its R&D and SG&A expenses for 2018 in the band of $100-$110 million and $170-$180 million, respectively.

Acorda awaits a positive cash balance in excess of $300 million by the end of 2018.

How Have Estimates Been Moving Since Then?

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

VGM Scores

At this time, ACOR has a strong Growth Score of A, though it is lagging a lot on the momentum front with an F. The stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of C. 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 growth based on our styles scores.

Outlook

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




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