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Intercept (ICPT) Moves 8% Higher: Will This Strength Last?

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  • ICPT

Intercept Pharmaceuticals ICPT shares soared 8% in the last trading session to close at $16.70. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 26.9% loss over the past four weeks.

Shares surged as the prescribing information for lead drug, Ocaliva (obeticholic acid or OCA), in the United States has been updated. This was in line with management's expectations. The update to the prescribing information was prompted by cases submitted to the FDA’s Adverse Event Reporting System and published in the medical literature. These were cases of worsening of liver problems or liver failure in PBC patients with cirrhosis treated with Ocaliva.

Price and Consensus

Price Consensus Chart for ICPT
Price Consensus Chart for ICPT

This drugmaker is expected to post quarterly loss of $1.25 per share in its upcoming report, which represents a year-over-year change of +34.9%. Revenues are expected to be $82.88 million, up 7.3% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For Intercept, the consensus EPS estimate for the quarter has been revised 11.1% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on ICPT going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank 3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>


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