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What's in the Cards for BioSpecifics (BSTC) in Q3 Earnings?

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BioSpecifics Technologies Corp. (BSTC - Free Report) is expected to report third-quarter 2018 results on Nov 9.

The company’s earnings beat estimates thrice in the last four reported quarters while missing the same on a single occasion, the average positive surprise being 11.37%. In the last reported quarter, BioSpecifics’ bottom line surpassed the consensus mark with a positive surprise of 20.41%.

Shares of BioSpecifics have soared 43% year to date against the industry’s decrease of 4.4%.

Let’s see, how things are shaping up for this announcement.

Factors to Consider

BioSpecifics’ only approved product is Xiaflex (collagenase clostridium histolyticum (CCH)), which is marketed in the United States by its partner Endo International plc (ENDP - Free Report) for the treatment of Dupuytren's contracture and Peyronie's disease.

BioSpecifics gets royalty and license revenues from Endo International, comprising its total revenues. Xiaflex is also marketed under different trade names in ex-U.S. markets.

Meanwhile, BioSpecifics is conducting a phase I label expansion study, evaluating CCH for uterine fibroids. In the second quarter of 2018, BioSpecifics completed enrollment in the same. Last month, the company announced positive top-line data from this phase I program, which met the primary endpoint of safety and tolerability with no clinically significant adverse events reported.

Endo International is performing two phase III clinical analyses on CCH for treating cellulite with top-line data expected by this year-end.

On third-quarter conference call, we expect management to provide an update on the label expansion studies of Xiaflex.

Earnings Whispers

Our proven model does not conclusively show that BioSpecifics is likely to beat estimates this to-be-reported quarter. This is because a stock needs to have both a positive Earnings ESP and a solid Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. But that is not the case here as you will see below.

Earnings ESP: BioSpecifics has an Earnings ESP of 0.00%. This is because both the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at 55 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: BioSpecifics currently carries a Zacks Rank #3, which increases the predictive power of ESP. However, the company’s 0.00% ESP makes surprise prediction difficult.

We caution against Sell-rated stocks (#4 or 5) going into an earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks That Warrant a Look

Here are some biotech stocks that you may want to consider as per our model, these have the right combination of elements to beat on earnings this reporting season.

Affimed N.V. (AFMD - Free Report) is scheduled to release third-quarter results on Nov 7. The company has an Earnings ESP of +5.88% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

FibroGen, Inc (FGEN - Free Report) has an Earnings ESP of +13.46% and a Zacks Rank #2. The company is scheduled to report third-quarter results on Nov 8.

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