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Exelixis (EXEL) to Report Q4 Earnings: What's in the Cards?

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Zacks Equity Research
·4 min read
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Exelixis, Inc. EXEL is scheduled to report fourth-quarter 2020 results on Feb 10, after market close.

The company has a decent earnings surprise track record, having surpassed expectations in three of the trailing four quarters and missing in the remaining one, with an average beat of 9.26%. In the last reported quarter, the company missed expectations by 100%.

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

Exelixis, Inc. Price, Consensus and EPS Surprise

Exelixis, Inc. Price, Consensus and EPS Surprise
Exelixis, Inc. Price, Consensus and EPS Surprise

Exelixis, Inc. price-consensus-eps-surprise-chart | Exelixis, Inc. Quote

Factors Likely to Impact Results

Exelixis generates total revenues from net product sales, license revenues, and collaboration and service revenues.

Last month, the company reported preliminary results for the fourth quarter and full year. Total revenues for the quarter came in at $270 million. Net product revenues for the quarter were $200 million, up from $168.6 million in the previous quarter.

Lead drug, Cabometyx, is likely to have seen an increase in sales in the to-be-reported quarter on elevated market demand, following lower revenues in the previous quarter due to reduced demand and a decline in wholesale inventory. Cabometyx (cabozantinib) tablets are approved for advanced renal cell carcinoma (RCC) and previously treated hepatocellular carcinoma (HCC), while Cometriq (cabozantinib capsules) is approved for the treatment of medullary thyroid cancer. The company generates majority of revenues from Cabometyx sales.

Research and development expenses were $155 million for the fourth quarter Selling, general and administrative expenses were $83 million.

Key Recent Developments

In January, Exelixis and partner Bristol-Myers Squibb Company BMY announced that the FDA approved Cabometyx in combination with the latter’s immuno-oncology drug, Opdivo, for the first-line treatment of patients with advanced RCC. The approval came ahead of the Prescription Drug User Fee Act action date of Feb 20, 2021. The FDA approval was based on positive results of the CheckMate -9ER study.

The approval is a significant boost for Cabometyx and further updates on the same are awaited on the call.

Investors are likely to focus on the pipeline progress of other candidates as well.

Share Price Performance

Exelixis’ shares have gained 20.6% in the past year compared with the industry’s growth of 14.2%.

Earnings Whispers

Our proven model does not conclusively predict an earnings beat for Exelixis this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. Unfortunately, that is not the case here as you will see below. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.

Earnings ESP: Earnings ESP for Exelixis is +93.94%.

Zacks Rank: The company currently carries a Zacks Rank #4 (Sell).

Stocks to Consider

Here are a few stocks you may want to consider, as our model shows that these have the right combination of elements to beat on earnings this season.

Moderna MRNA has an Earnings ESP of +0.57% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Seagen, Inc. SGEN has an Earnings ESP of +4.81% and a Zacks Rank #3.

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