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Theravance Bio (TBPH) Up 25.6% Since Last Earnings Report: Can It Continue?

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A month has gone by since the last earnings report for Theravance Biopharma (TBPH - Free Report) . Shares have added about 25.6% in that time frame, outperforming the S&P 500.

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

Theravance Q3 Loss In Line, Revenues Lag Estimates

Theravance Biopharma incurred a loss of $1.05 per share in third-quarter 2019, in line with the Zacks Consensus Estimate. Meanwhile, the figure is narrower than the year-ago quarter’s loss of $1.10.

Total revenues of $12.4 million in the quarter missed the Zacks Consensus Estimate of $13 million. Revenues decreased 3.1% year over year, mainly due to lack of product sales following the divesture of its only marketed drug Vibativ last November. Total revenues in the third quarter comprised collaboration revenues of $8.8 million and $3.6 million received from Mylan.

Quarterly Details

Research & development expenses were $52 million, down 1.3% from the year-ago quarter, primarily owing to lower employee-related expenses linked with the reduction in sales force.

Selling, general & administrative expenses escalated 16.9% to $25.6 million due to higher external expenses and higher share-based compensation.

As of Sep 30, 2019, Theravance had cash, cash equivalents, marketable securities and restricted cash of $352.9 million compared to $396.1 million as of Jun 30, 2019.

2019 Outlook

For 2019, Theravance anticipates operating loss excluding non-cash share-based compensation to be in the range of $200-$210 million, narrowed from the previous guidance of $210-$230 million.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates have trended downward during the past month. The consensus estimate has shifted 8.4% due to these changes.

VGM Scores

Currently, Theravance Bio has a subpar Growth Score of D, however its Momentum Score 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.

Outlook

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


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