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Agios Pharmaceuticals (AGIO) Down 11.2% Since Last Earnings Report: Can It Rebound?

Zacks Equity Research

A month has gone by since the last earnings report for Agios Pharmaceuticals (AGIO). Shares have lost about 11.2% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Agios Pharmaceuticals due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.

Agios Loss Widens in Q2, Tibsovo Sales Rise

Agios incurred second-quarter 2019 loss of $1.87 per share, wider than the Zacks Consensus Estimate of a loss of $1.73 and also the year-ago loss of $1.19.

However, total revenues in the reported quarter were $26.2 million, above the Zacks Consensus Estimate of $24.6 million but lower than the year-ago top-line figure of $40.4 million.

Tibsovo generated sales of $13.7 million in the second quarter of 2019, reflecting a sequential surge of more than 50%.

Royalty revenues earned from Celgene were $2.7 million on Idhifa net sales while collaboration revenues were $9 million in the reported quarter.

Research & development expenses rose 23.9% year over year to $107.4 million, largely due to higher cost of clinical studies for pipeline development.

General and administrative expenses escalated 21.8% year over year to $32.4 million on account of higher investments in supporting the commercial launch of Tibsovo as well as steep personnel costs.

Agios ended the second quarter with cash, cash equivalents and marketable securities of $624 million, lower than the sequential quarter’s tally of $707.8 million. The company expects this cash balance and revenues recognized from Tibsovo and royalties to effectively fund its current operational plans for at least through 2020.

How Have Estimates Been Moving Since Then?

Fresh estimates followed a downward path over the past two months. The consensus estimate has shifted -7.37% due to these changes.

VGM Scores

Currently, Agios Pharmaceuticals has a poor Growth Score of F, however its Momentum Score is doing a lot better with an A. However, 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.

Outlook

Agios Pharmaceuticals has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.



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