The first-quarter earnings season for the Medical sector will be in full swing this week as several drugmakers are slated to report their earnings results. The sector mainly comprises pharma/biotech and medical device companies. Most pharma bigwigs have already reported their first-quarter earnings results. Among the large caps, J&J Merck, Bristol Myers, Novartis and Amgen have beaten both their first-quarter earnings and sales estimates, while Pfizer, Eli Lilly, Sanofi and Biogen reported mixed first-quarter earnings results. Regeneron, on the other hand, missed both earnings and sales estimates this time around.
Per the Earnings Trends report, as of April 30, 45% of the Medical sector companies, constituting about 57.9% of the sector’s market capitalization, posted earnings. Among the companies that reported first-quarter earnings, 66.7% of them beat both earnings and revenue estimates. Earnings increased 60.5% year over year, while revenues rose 7.8%.
Overall, first-quarter earnings of the Medical sector are expected to rise 40%, while revenues are projected to increase 8.3%. (Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.)
Zeroing in on Winners
Here, we have highlighted five drug/biotech companies — Novo Nordisk NVO, Pacira BioSciences PCRX, Ultragenyx Pharmaceuticals RARE, Acadia Pharmaceuticals ACAD and Denali Therapeutics DNLI — that are expected to deliver a beat in their upcoming quarterly results.
Earnings ESP is our proprietary methodology for determining the stocks that have the best chance of delivering an earnings surprise. Earnings ESP shows the percentage difference between the Most Accurate Estimate and the Zacks Consensus Estimate.
According to the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. The selection can be done with the help of the Zacks Stock Screener.
Our research shows that for stocks with this combination, the chance of an earnings surprise is as high as 70%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Novo Nordisk
Bagsværd, Denmark-based Novo Nordisk has an Earnings ESP of +0.82% and a Zacks Rank #3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for first-quarter earnings is pegged at 92 cents per share, while that for revenues is pinned at $11.33 billion. Novo Nordisk is set to release results on May 7, before the opening bell.
NVO beat estimates in two of the last four quarters while missing the mark on the other two occasions, with the average surprise being 1.97%.
Novo Nordisk’s first-quarter revenues are likely to have been boosted by the higher sales of Diabetes and Obesity Care products. Diabetes medicines like Ozempic and Rybelsus are expected to have put up a strong performance in the to-be-reported quarter. Sales of Obesity Care drugs, Saxenda and Wegovy, are likely to have been encouraging as well.
Novo Nordisk A/S Price, Consensus and EPS Surprise
Novo Nordisk A/S Price, Consensus and EPS Surprise
Novo Nordisk A/S price-consensus-eps-surprise-chart | Novo Nordisk A/S Quote
Pacira BioSciences
Tampa, FL-based Pacira presently has an Earnings ESP of +34.51% and a Zacks Rank #3. The Zacks Consensus Estimate for first-quarter earnings is pegged at 57 cents per share, while that for revenues is pinned at $174.96 million. Pacira is slated to report quarterly results on May 8, after market close.
PCRX beat estimates in three of the last four quarters while missing the mark on the remaining occasion, with the average surprise being 8.58%.
Pacira’s revenues in the first quarter are likely to have been driven primarily by growing sales of its flagship pain-management product, Exparel, across all its approved indications. Sales of its other products, osteoarthritis knee pain drug, Zilretta and iovera medical device are expected to have increased in the to-be-reported quarter, contributing to the top-line growth.
Pacira BioSciences, Inc. Price, Consensus and EPS Surprise
Pacira BioSciences, Inc. Price, Consensus and EPS Surprise
Pacira BioSciences, Inc. price-consensus-eps-surprise-chart | Pacira BioSciences, Inc. Quote
Ultragenyx Pharmaceuticals
Based in Novato, CA, Ultragenyx currently has an Earnings ESP of +29.32% and a Zacks Rank #3. The Zacks Consensus Estimate for first-quarter loss is pegged at $1.54 per share, while that for revenues is pinned at $141.99 million. Ultragenyx is slated to report quarterly results on May 6, after market close.
RARE beat estimates in two of the last four quarters while missing the mark on the other two occasions, delivering an average negative surprise of 4.84%.
Ultragenyx’s revenues in the first quarter are likely to have been driven primarily by growing sales of its lead drug, Crysvita, as a result of increased demand for approved indications. Sales of its other products, Mepsevii, Dojolvi and Evkeeza (in partnership with Regeneron) are likely to have increased in the to-be-reported quarter, contributing to the top-line growth.
Ultragenyx Pharmaceutical Inc. Price, Consensus and EPS Surprise
Ultragenyx Pharmaceutical Inc. Price, Consensus and EPS Surprise
Ultragenyx Pharmaceutical Inc. price-consensus-eps-surprise-chart | Ultragenyx Pharmaceutical Inc. Quote
Acadia Pharmaceuticals
San Diego, CA-based Acadia Pharmaceuticals has an Earnings ESP of +17.37% and a Zacks Rank #3 at present. The Zacks Consensus Estimate for first-quarter earnings is pegged at 6 cents per share, while that for revenues is pinned at $241.74 million. Acadia is scheduled to report quarterly results on May 7, after market close.
ACAD beat estimates in three of the last four quarters while missing the mark on the remaining occasion, with the average surprise being 54.58%.
Acadia’s revenues in the first quarter are likely to have been driven primarily by the growing sales volume of its lead drug, Nuplazid, approved in the United States for the treatment of hallucinations and delusions associated with Parkinson’s disease psychosis. Sales growth of ACAD’s second product, Daybue, approved for treating Rett syndrome, is likely to have contributed to the top line.
ACADIA Pharmaceuticals Inc. Price, Consensus and EPS Surprise
ACADIA Pharmaceuticals Inc. Price, Consensus and EPS Surprise
ACADIA Pharmaceuticals Inc. price-consensus-eps-surprise-chart | ACADIA Pharmaceuticals Inc. Quote
Denali Therapeutics
Based in South San Francisco, Denali presently has an Earnings ESP of +4.87% and a Zacks Rank #3. The Zacks Consensus Estimate for first-quarter loss is pegged at 71 cents per share, while that for revenues is pinned at $8.3 million. Denali is expected to report its first-quarter results soon.
DNLI beat estimates in two of the last four quarters while missing the mark on the other two occasions, delivering an average negative surprise of 6.51%.
Denali currently has no marketed products in its commercial portfolio. The revenue estimate for the to-be-reported quarter reflects expectations regarding the collaboration revenues recognized in this reporting cycle. DNLI is most likely to share updates regarding its pipeline programs when it reports first-quarter results, especially regarding the regulatory timeline of its lead candidate, tividenofusp alfa, for the treatment of Hunter syndrome (MPS II). The company recently began a rolling submission of a biologics license application for the accelerated approval of the candidate for the MPS II indication.
Denali Therapeutics Inc. Price, Consensus and EPS Surprise
Denali Therapeutics Inc. Price, Consensus and EPS Surprise
Denali Therapeutics Inc. price-consensus-eps-surprise-chart | Denali Therapeutics Inc. Quote
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