It has been about a month since the last earnings report for Acadia Pharmaceuticals (ACAD). Shares have lost about 2.9% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Acadia due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Acadia reported third-quarter 2024 earnings of 20 cents per share, beating the Zacks Consensus Estimate of 13 cents. In the year-ago quarter, the company had incurred a loss of 40 cents per share.
Acadia recorded total revenues of $250 million, which beat the Zacks Consensus Estimate of $249 million. ACAD’s net product revenues comprise revenues generated from the sale of its two marketed products, Nuplazid (pimavanserin) and the newly launched Daybue (trofinetide).
Total revenues jumped 18% year over year, driven by the contribution from Daybue and the continued growth in Nuplazid's market share.
ACAD’s Q3 Results in Detail
Revenues from Nuplazid increased 10% year over year to $159.2 million, driven by 7% growth in volumes. Nuplazid sales beat the Zacks Consensus Estimate of $155.6 million as well as our model estimate of $150.9 million.
Daybue recorded net product sales of $91.2 million in the reported quarter, up 36% year over year and 8% sequentially, driven by the growth in the drug’s unit sales. The reported figure, however, missed the Zacks Consensus Estimate of $93.8 million as well as our model estimate of $97.4 million.
Research and development (R&D) expenses were $66.6 million, down 58% year over year. The fall in R&D cost was mainly due to decreased business development payments in the reported quarter. The year-ago quarter figure included the $100 million payment to Neuren under the license agreement for trofinetide, which later got approval under the brand name Daybue.
Selling, general and administrative (SG&A) expenses were $133.3 million, up 36% year over year. The increase in such expenses can be primarily attributed to the consumer activation program to support the Nuplazid franchise. Increased marketing costs of Daybue in the United States, along with investments to commercialize the drug outside the United States, also fueled the surge in SG&A expenses.
Acadia had cash, cash equivalents and investments worth $565.3 million as of Sept. 30, 2024, compared with $500.9 million as of June 30, 2024.
ACAD Updates 2024 Financial Guidance
Acadia updated its financial guidance for 2024 in its third-quarter earnings release. Total revenue is now projected in the range of $940-$960 million, narrower than the previously guided range of $930-$980 million.
The company now expects Daybue sales in the range of $340-$350 million in 2024 compared with the previously guided range of $340-$370 million.
Nuplazid revenues are now projected in the band of $600-$610 million compared with the previously guided range of $590-$610 million.
ACAD projects its full-year R&D expenses in the band of $280-$290 million, down from the previously guided range of $305-$315 million.
On the other hand, the company increased its guidance for SG&A expenses, which are now anticipated in the range of $480-$495 million compared with the previously guided range of $465-$480 million on account of higher commercialization costs associated with the Daybue launch.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted 172% due to these changes.
VGM Scores
Currently, Acadia has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending downward for the stock, and the magnitude of these revisions looks promising. Notably, Acadia has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Acadia is part of the Zacks Medical - Biomedical and Genetics industry. Over the past month, Exelixis (EXEL), a stock from the same industry, has gained 0.7%. The company reported its results for the quarter ended September 2024 more than a month ago.
Exelixis reported revenues of $539.54 million in the last reported quarter, representing a year-over-year change of +14.3%. EPS of $0.47 for the same period compares with $0.10 a year ago.
Exelixis is expected to post earnings of $0.46 per share for the current quarter, representing a year-over-year change of +39.4%. Over the last 30 days, the Zacks Consensus Estimate has changed +1%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #2 (Buy) for Exelixis. Also, the stock has a VGM Score of A.
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