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ACADIA Pharma (ACAD) Q4 Earnings: What's in Store this Time?

Zacks Equity Research

ACADIA Pharmaceuticals Inc. ACAD is expected to report fourth-quarter 2016 results on Feb 28.

The company’s track record is dismal. ACADIA has missed estimates in all the trailing four quarters, bringing the average negative earnings surprise to 19.07%.

ACADIA’s share price increased 35.7% year- to -date compared with the Zacks classified Medical - Biomedical and Genetics industry’s gain of 8.6%.

Let’s see how things are shaping up for this announcement.

Factors at Play

In Apr 2016, the FDA approved the ACADIA’s first drug, Nuplazid, for the treatment of hallucinations and delusions associated with Parkinson’s disease psychosis. Nuplazid  became available for prescription in the U.S. on May 31, 2016.  ACADIA made good progress with the commercial launch of Nuplazid drug, which is used for the treatment of hallucinations and delusions.

This newly launched drug generated revenues of $5.3 million in the third quarter and sales are expected to grow steadily over years to come. The company witnessed very good reimbursement and access for Nuplazid from public and private payers, who had been successful earlier over getting on formularies.

Hence, the company expects sales to ramp up further. All these makes the company confident about the initial positive experiences reported by physicians, which is expected to continue to accelerate prescribing of Nuplazid for patients with Parkinson's disease psychosis.

Meanwhile, the company is also on track with its multiyear plans of developing Nuplazid in indications beyond PD psychosis. It reported positive top-line results from its phase II exploratory study (-019 Study) of Nuplazid in patients with Alzheimer’s disease (AD) psychosis in Dec 2016. However, the FDA has not yet approved any drug to treat AD Psychosis.

Additionally, in Dec 2016 the company had initiated CLARITY, a phase II study to evaluate Nuplazid for adjunctive treatment in patients with major depressive disorder (MDD), who have an inadequate response to first-line therapies for clinical depression. The candidate is also being studied in a phase III trial called ENHANCE-1 for the treatment of schizophrenia as well as a Phase II study- ADVANCE, to evaluate Nuplazid for adjunctive treatment in patients with negative symptoms of schizophrenia.

ACADIA Pharmaceuticals Inc. Price and EPS Surprise

ACADIA Pharmaceuticals Inc. Price and EPS Surprise | ACADIA Pharmaceuticals Inc. Quote

Earnings Whispers

Our proven model does not conclusively show that ACADIA is likely to beat estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. However, that is not the case here as you will see below.

Zacks ESP: ACADIA has an Earnings ESP of 0.00%. That is because the both the Most Accurate estimate and the Zacks Consensus Estimate stand at a loss of 65 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: ACADIA has a Zacks Rank #3, which increases the predictive power of ESP. However, 0.00% ESP makes surprise prediction difficult for the quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.

Note that we caution against stocks with Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks to Consider

Here are some health care stocks that you may want to consider, as our model shows that it has the right combination of elements to post an earnings beat this quarter.

Pacira Pharmaceuticals, Inc. PCRX has an Earnings ESP of +20% and a Zacks Rank #2. The company is scheduled to release results on Mar 1.

Syndax Pharmaceuticals, Inc. SNDX has an Earnings ESP of +18.18% and a Zacks Rank #3. The company is scheduled to release results on Mar 2.

Exelixis, Inc. EXEL has an Earnings ESP of +200% and a Zacks Rank #2. The company is scheduled to release results on Feb 27.

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Exelixis, Inc. (EXEL): Free Stock Analysis Report
 
ACADIA Pharmaceuticals Inc. (ACAD): Free Stock Analysis Report
 
Pacira Pharmaceuticals, Inc. (PCRX): Free Stock Analysis Report
 
Syndax Pharmaceuticals, Inc. (SNDX): Free Stock Analysis Report
 
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