Deciphera Pharmaceuticals, Inc. (DCPH) Down 9.7% Since Last Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for Deciphera Pharmaceuticals, Inc. (DCPH). Shares have lost about 9.7% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Deciphera Pharmaceuticals, Inc. 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.
Deciphera Q2 Earnings Beat, Qinlock Drives Revenues
Deciphera Pharmaceuticals, Inc. reported second-quarter 2023 loss of 57 cents per share, narrower than the Zacks Consensus Estimate of a loss of 62 cents. In the year-ago quarter, DCPH had incurred a loss of 60 cents per share.
Net revenues were $38.3 million, which beat the Zacks Consensus Estimate of $36 million. The figure rose almost 18.8% year over year.
Quarter in Detail
Total revenues comprise net product revenues and collaboration revenues for Qinlock (ripretinib).
Deciphera’s sole marketed drug, Qinlock, was approved by the FDA in 2020 to treat adult patients with advanced GIST, who received prior treatment with three or more kinase inhibitors, including Novartis’ Gleevec (imatinib). Qinlock was approved in Europe in late 2021. Apart from Qinlock, there is no marketed drug in Deciphera’s portfolio.
Net product revenues from Qinlock sales were $37.3 million, up 18.4% year over year. The drug generated sales of $28.9 million and $8.4 million in the United States and the ex-U.S. markets, respectively.
Qinlock’s net product revenues beat both the Zacks Consensus Estimate of $35.09 million and our model estimate of $35 million.
Collaboration revenues totaled $1 million, which was in line with the year-ago quarter’s figure. The top line missed the Zacks Consensus Estimate of $1.26 million but beat our model estimate of $0.3 million.
Research and development expenses (including stock-based compensation) amounted to $58.3 million, up 30% year over year owing to costs related to clinical studies on vimseltinib and Qinlock.
Selling, general and administrative expenses (including stock-based compensation) totaled $32.6 million, up 10.1% year over year owing to increased professional fees, personnel-related costs and consultant fees.
Deciphera had cash, cash equivalents and investments worth $389.4 million as of Jun 30, 2023 compared with $426.3 million as of Mar 31, 2023. The company expects its current cash balance, together with the anticipated product, royalty and supply revenues, excluding any potential future milestone payments under its collaboration or license agreements, to fund its operating and capital expenditures into 2026.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision flatlined during the past month.
VGM Scores
Currently, Deciphera Pharmaceuticals, Inc. has an average Growth Score of C, a grade with the same score on the momentum front. 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 D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Deciphera Pharmaceuticals, Inc. 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
Deciphera Pharmaceuticals, Inc. belongs to the Zacks Medical - Biomedical and Genetics industry. Another stock from the same industry, Blueprint Medicines (BPMC), has gained 2.5% over the past month. More than a month has passed since the company reported results for the quarter ended June 2023.
Blueprint Medicines reported revenues of $57.57 million in the last reported quarter, representing a year-over-year change of +57.5%. EPS of -$2.19 for the same period compares with -$2.68 a year ago.
For the current quarter, Blueprint Medicines is expected to post a loss of $2.39 per share, indicating a change of -7.2% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.7% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Blueprint Medicines. Also, the stock has a VGM Score of F.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Deciphera Pharmaceuticals, Inc. (DCPH) : Free Stock Analysis Report
Blueprint Medicines Corporation (BPMC) : Free Stock Analysis Report
