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Bluebird (BLUE) Down 7.8% Since Last Earnings Report: Can It Rebound?

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A month has gone by since the last earnings report for Bluebird Bio (BLUE). Shares have lost about 7.8% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Bluebird 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 catalysts.

bluebird Q2 Earnings and Revenues Beat

bluebird reported a loss of 36 cents per share in second-quarter 2020, narrower than the Zacks Consensus Estimate of a loss of $1.91and the year-ago quarter's loss of $3.55.

Revenues of $198.9 million easily beat  the Zacks Consensus Estimate of $102 million. The figure was up from $13.3 million in the year-ago quarter.

Quarter in Detail    

R&D expenses increased to $156.3 million from $146.5 million a year ago due to costs incurred by the company to advance and expand the pipeline.

Selling, general and administrative (SG&A) expenses of $68.6 million were almost flat from the year-ago quarter to support its operations, overall growth of the pipeline, and commercial-readiness activities.

Pipeline Development

On July 29, 2020, bluebird bio and Bristol Myers Squibbannounced the submission of their biologics license application (BLA) to FDA for idecabtagene vicleucel (ide-cel; bb2121), the companies’ investigational B-cell maturation antigen (BCMA)-directed chimeric antigen receptor (CAR) T cell immunotherapy. This submission provides further details on the Chemistry, Manufacturing and Controls (CMC) module to address the outstanding regulatory requests from the FDA in May 2020 following the original BLA submission.

On May 22, 2020, Bristol Myersannounced that the European Medicines Agency (EMA) validated its marketing authorization applications (MAA) for ide-cel. Validation of the application confirms the submission is complete and begins the EMA’s centralized review process.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in fresh estimates. The consensus estimate has shifted 10.19% due to these changes.

VGM Scores

Currently, Bluebird has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. However, the stock was allocated a grade of F on the value side, putting it in the bottom 20% quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Bluebird has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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