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Glaukos (GKOS) Up 13.8% Since Last Earnings Report: Can It Continue?

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It has been about a month since the last earnings report for Glaukos (GKOS - Free Report) . Shares have added about 13.8% in that time frame, outperforming the S&P 500.

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

Glaukos Q1 Earnings and Revenues Miss Estimates

Glaukos Corporation reported first-quarter 2020 loss per share of 44 cents, wider than the Zacks Consensus Estimate of a loss of 35 cents. Notably, the company had delivered loss per share of 4 cents a year ago.

Revenues in Detail

Quarterly net sales totaled $55.3 million, which missed the Zacks Consensus Estimate by 0.1%. On a year-over-year basis, revenues improved 2.4%. Per management, the upside can be attributed to contribution from the Avedro buyout. However, disruptions related to COVID-19 mainly offset the upside.  

Quarter Details

Gross profit in the first quarter was $22.8 million, down 51.4% year over year. Gross margin quarter was 41.2% of net revenues, down 4562 basis points on a year-over-year basis.

Operating expenses increased 54.4% to $75.4 million on a year-over-year basis, courtesy of higher selling, general and administrative, and research and development expenses.

Financial Update

The company exited the first quarter with cash and cash equivalents of $53.6 million, down from $62.4 million at the end of 2019.

During the first quarter, totalcurrent assets came in at $231.4 million compared with $262.9million at the end of 2019.

2020 Guidance

Glaukos has withdrawn its previously announced (Feb 27, 2020) annual guidance for 2020 due to the uncertainties emanating from the COVID-19 pandemic.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in fresh estimates. The consensus estimate has shifted -58.16% due to these changes.

VGM Scores

Currently, Glaukos has a poor Growth Score of F, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of F on the value side, putting it in the fifth 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 this revision indicates a downward shift. Notably, Glaukos has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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