It has been about a month since the last earnings report for Celgene Corporation CELG. Shares have added about 6% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock’s next earnings release, or is it due for a pullback? 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.
Celgene Misses on Earnings & Revenues, View Unchanged
Celgene reported fourth-quarter 2016 earnings of $1.41 per share (including share-based compensation expense and tax adjustments), missing the Zacks Consensus Estimate of $1.43 but up from $1.02 per share in the year-ago quarter.
Excluding share-based compensation expense, Celgene’s earnings climbed approximately 36.4% year over year to $1.61 in the reported quarter.
Total revenue soared 16.3% to $2.98 billion in the fourth quarter of 2016. Revenues were boosted by a consistently strong performance by the company’s key growth driver, Revlimid. However, revenues were below the Zacks Consensus Estimate of $3.0 billion.
Revlimid Continues to Shine
Net product sales increased 17.2% year over year to $2.98 billion, including a 0.3% negative impact from currency movement.
Net sales of Revlimid came in at $1.8 billion, reflecting a year-over-year increase of 15.9%. The drug did well in the U.S. (up 24.2%). Growth in the reported quarter was driven by new patient market share gains and longer duration.
Net sales of another cancer drug, Abraxane, declined 1.4% to $266.1 million. Sales of oncology drug, Pomalyst/Imnovid, came in at $377.9 million, up 28.6%. Sales were driven by increased volume from duration gains.
Newly launched Otezla reported sales of $305 million in the reported quarter, up 67%. Sales benefited from increased contribution from early launch in European countries.
All other product sales (including Istodax, Thalomid, Vidaza and an authorized generic version of Vidaza in the U.S.) totaled $220 million in the fourth quarter, down 4.8%.
Adjusted research and development expenses increased approximately 3.7% to $673 million, while adjusted selling, general and administrative expenses were roughly flat at $534 million.
2017 Outlook
For 2017, Celgene expects earnings around $7.10 to $7.25 per share. The Zacks Consensus Estimate for earnings stands at $6.55. Net product sales are expected around $13.0–$13.4 billion.
Revlimid sales are projected between $8 billion - $8.3 billion. Abraxane sales are still estimated to be around $1 billion.
The guidance maintained was in line with the one issued with the preliminary results released earlier in the month.
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