Nektar Therapeutics (NKTR) Up 57.2% Since Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Nektar Therapeutics NKTR. Shares have added about 57.2% 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.
Nektar Therapeutics Loss Wider-than-Expected in Fourth Quarter
Nektar Therapeutics reported loss of $0.28 per share in the fourth quarter of 2016, wider than the Zacks Consensus Estimate of loss of $0.26. The reported loss was, however, narrower than the year-ago loss of $0.40 per share. Quarterly revenues decreased 4.8% to $37.5 million from the year-ago quarter. Revenues missed the Zacks Consensus Estimate of $43 million.
Quarter in Detail
The top line comprised product sales, royalty revenues, non-cash royalty revenues, license, collaboration and other revenues.
Product sales declined 2.1% to almost $13.7 million in the fourth quarter of 2016, while non-cash royalty revenues jumped 6.8% to $7.8 million.
The company reported royalty revenues of $6.4 million in the fourth quarter compared with $1.9 million in the year-ago quarter. This was mainly due to royalty revenues from Movantik sales. License, collaboration and other revenues came in at $9.5 million compared with $16.2 million a year ago.
Research and development (R&D) expenses were up 6.6% to $50.2 million, primarily due to investments in pipeline, including candidates like NKTR-181 and NKTR-214. Also, preparations for advancing NKTR-358 into the clinic in the first quarter of 2017 led to the increase in expenses.
General and administrative (G&A) expenses were down 3% to $12.8 million.
2016 Results
Full-year sales decreased to $165.4 million from year-ago figure of $230.8 million.
The full-year loss of $1.10 per share was wider than year-ago loss of $0.61.
2017 Outlook
The company expects total revenue in the range of $145–$155 million in 2017. The company expects R&D expenditure in the range of $230–$240 million and G&A expenses in the band of $45–$47 million during the same period.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimate flatlined during the past month. There has been one upward revision for the current quarter compared toone downward.
Nektar Therapeutics Price and Consensus
Nektar Therapeutics Price and Consensus | Nektar Therapeutics Quote
VGM Scores
At this time, Nektar Therapeutics's stock has a poor Growth Score of 'F', however its Momentum is doing a lot better with an 'A'. Charting a somewhat similar path, 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.
The company's stock is suitable solely for momentum investors, based on our styles scores..
Outlook
The stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.
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