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Editas (EDIT) Up 9.3% Since Last Earnings Report: Can It Continue?

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Zacks Equity Research
·2 min read
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A month has gone by since the last earnings report for Editas Medicine (EDIT). Shares have added about 9.3% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Editas due for a pullback? 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.

Editas' Earnings Rise Y/Y in Q3, EDIT-101 in Focus

Editas delivered earnings of 12 cents per share in the third quarter of 2020, reversing the year-ago quarter’s loss of 66 cents. The Zacks Consensus Estimate was of a loss of 66 cents per share.

Collaboration, and other research and development revenues comprising the company’s top line came in at $62.8 million in the reported quarter, substantially up from the year-ago quarter’s $4 million. The top line also comprehensively beat the Zacks Consensus Estimate of $7 million.

Quarter in Detail

Research and development expenses were $33.9 million, up 49.3% from the year-ago figure due to increased expenses related to the development of EDIT-101.

General and administrative expenses increased 26.7% to $19.9 million owing to higher professional service expenses and personnel costs.

How Have Estimates Been Moving Since Then?

It turns out, estimates review flatlined during the past month. The consensus estimate has shifted 8.69% due to these changes.

VGM Scores

At this time, Editas 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 lowest 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

Editas has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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