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BioDelivery (BDSI) Up 7.8% Since Last Earnings Report: Can It Continue?

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A month has gone by since the last earnings report for BioDelivery Sciences International (BDSI - Free Report) . Shares have added about 7.8% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is BioDelivery due for a pullback? 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 drivers.

BioDelivery Q4 Earnings In Line, Sales Beat

BioDelivery reported loss of 10 cents per share for fourth-quarter 2018, meeting the Zacks Consensus Estimate. In the year-ago quarter, the company had recorded a loss of 29 cents per share.

Revenues were $18 million in the reported quarter, up 44.1% from the year-ago period and 27.4% sequentially. The increase in sales was mainly driven by strong demand for Belbuca, which exceeded the company’s expectations. The top line beat the Zacks Consensus Estimate of $16.15 million.

Quarter in Detail

Belbuca continued its strong sequential growth trend of 2018 into the fourth quarter. The company witnessed consistent increase in new patients as well as in total prescriptions every quarter in 2018. The drug generated revenues of $15.9 million in the quarter, rising 28.3% sequentially. Sales surged 68.3% year over year.

Prescription volume for Belbuca expanded 27% sequentially and 126% year over year. During the quarter, the company recorded all-time high prescription volumes of almost 56,000 prescriptions for Belbuca.

The company added approximately 1,100 new patients to Belbuca treatment during the quarter, higher than 900 new patients in the previous two quarters. Management seems confident about Belbuca’s continued strong performance in 2019.

Operating expenses increased 30.3% to $18.5 million due to expansion of commercial and medical teams. However, operating expenses fell 14.4% year over year.

Full-Year Results

BioDelivery reported total revenues of $55.6 million in 2018, down 10.2% year over year. The decline was due to $20 million recorded as contract revenues in 2017 related to the termination of the licensing agreement with Endo for Belbuca rights. Excluding contract revenues, total revenues grew 32.5% in 2018.

Total sales of Belubca during 2018 were $46 million, up 70.5% year over year.Bunavail sales declined 31.7% to $5.4 million.

For the full year, the company incurred an adjusted loss of 54 cents per share compared with adjusted loss of 67 cents per share in the year-ago period.

The company ended 2018 with $43.8 million in cash and cash equivalents.

2019 Guidance

The company guided total revenues to in the range of $85 million to $90 million for 2019.

The company expects Belbuca sales to be between $80 and $85 million, indicating an almost 80% increase at the mid-point of the range. The company expects the drug to achieve annual net sales of $250 million to $300 million over the long term.

The company anticipates operating cash flow to turn positive in 2019.

How Have Estimates Been Moving Since Then?

Fresh estimates followed an upward path over the past two months. The consensus estimate has shifted -25% due to these changes.

VGM Scores

Currently, BioDelivery has a strong Growth Score of A, a grade with the same score on the momentum front. 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 B. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

BioDelivery has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.




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