Acadia (ACAD) Down 0.7% Since Last Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for Acadia Pharmaceuticals (ACAD). Shares have lost about 0.7% 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 drivers.
Acadia Q2 Earnings & Revenues Beat Estimates, '23 View Up
Acadia Pharmaceuticals Inc.reported second-quarter 2023 earnings of 1 cent per share. The Zacks Consensus Estimate was pegged at a loss of 12 cents per share. In the year-ago quarter, the company had incurred a loss of 21 cents per share.
The company recorded net product revenues of $165.2 million in the reported quarter, surpassing the Zacks Consensus Estimate of $154 million. Acadia’s net product revenues comprised of revenues from two of its marketed products, such as Nuplazid (pimavanserin) and the newly-approved Daybue (trofinetide).
Quarter in Detail
In the reported quarter, revenues from Nuplazid sales increased 5.5% year over year to $142 million. Nuplazid sales increased 19.8% sequentially in the second quarter. Per the company, the uptick in Nuplazid sales was primarily driven by an increase in volume due to demand from new patient starts of Nuplazid and a higher average net selling price. The reported second-quarter figure beat our model estimate of $132.9 million.
In the first quarter of commercialization in April 2023, Daybue recorded net product sales of $23.2 million for the reported quarter. Management claims that more than 400 prescribers have written prescriptions for Daybue, to date.
Research and development (R&D) expenses in the quarter were $58.8 million, down 22.2% year over year, owing to decreased costs in the prior year associated with pre-approval manufacturing supply expenses for trofinetide.
Selling, general and administrative (SG&A) expenses were $96 million, up 6.8% year over year. The improvement in the expenses can be attributed to increased commercial costs associated with the Daybue launch, partially offset by efficiencies in Acadia’s commercial support of Nuplazid.
Acadia had cash, cash equivalents and investments worth $375.4 million as of Jun 30, 2023, compared with $402.9 million as of Mar 31, 2023. The decrease in cash balance is on account of the $40 million milestone payment to Neuren related to Daybue’s first commercial sale.
2023 Financial Guidance Updated
Acadia expects third-quarter 2023 Daybue sales in the range of $45-$55 million.
ACAD now expects Nuplazid net sales in the range of $530-$545 million (previously $520-$550 million), thus streamlining its expectations for the full-year 2023.
The company expects R&D expenses in the $335-$355 million range (previously $235-$255 million. This guidance includes the $100 million upfront payment to Neuren in July for the expanded licensing agreement.
SG&A expenses are expected in the band of $380-$400 million (previously $360-$380 million) in 2023. The anticipated rise in SG&A expenses is on account of higher operating costs as a result of favorable business performance, including employee retention costs as well as Daybue incentive compensation and investments in patient support services.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
The consensus estimate has shifted -364.42% due to these changes.
VGM Scores
At this time, Acadia has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a C. Charting a somewhat similar path, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. 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 these revisions indicates a downward shift. 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 belongs to the Zacks Medical - Biomedical and Genetics industry. Another stock from the same industry, Alkermes (ALKS), has gained 5.7% over the past month. More than a month has passed since the company reported results for the quarter ended June 2023.
Alkermes reported revenues of $617.4 million in the last reported quarter, representing a year-over-year change of +123.5%. EPS of $0.55 for the same period compares with $0.06 a year ago.
For the current quarter, Alkermes is expected to post earnings of $0.45 per share, indicating a change of +2150% from the year-ago quarter. The Zacks Consensus Estimate has changed -1.6% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Alkermes. Also, the stock has a VGM Score of A.
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ACADIA Pharmaceuticals Inc. (ACAD) : Free Stock Analysis Report
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