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Intrexon (XON) Q3 Loss Narrower Than Expected, Revenues Miss

Zacks Equity Research

Intrexon Corporation XON reported adjusted loss of 20 cents per share in the third quarter of 2017, which was narrower than the Zacks Consensus Estimate of a loss of 22 cents.

Total revenues came in at $46 million, up 6.1% year over year. Reported revenues missed the Zacks Consensus Estimate of $55 million.

So far this year, the stock has been down 34.6%, as against the industry’s gain of 1.2%.


Quarter in Detail

Intrexon’s sales primarily consist of collaboration and licensing revenues as well as product and service revenues.

Collaboration and licensing revenues fell 8% to $28.2 million year over year. The decline was due to a decrease in research and development services for some of the company's collaborations as Intrexontemporarily redeployed certain resources toward supporting prospective new platforms and partnering opportunities.

While product revenues came in at $7.7 million, down 17.2% from the year-ago period, service revenues amounted to $9.9 million, down 14.6% year over year.

Intrexon follows a business model under which it commercializes its technologies through exclusive channel collaborations (ECC), licensing agreements and joint ventures with collaborators that have market and product development expertise as well as sales and marketing capabilities to bring new and improved products and processes to market. Such agreements provide the company with funds in the form of technology access fees along with milestones and other payments.

Meanwhile, the company is developing several candidates in partnership with other companies.

Also, Intrexon’s a majority-owned subsidiary, Xogenex, filed an Investigational New Drug (IND) application with the FDA for a phase I study of the gene therapy, INXN-4001 — the world's first multigene therapeutic candidate expressing proteins from three cardiac effector genes — for the treatment of heart disease.

Intrexon’s collaborator, ZIOPHARM ZIOP, announced the dosing of first patient in a new phase I study of its gene therapy Ad-RTS-hIL-12 + veledimex for the treatment of pediatric brain tumors.

Furthermore, the company’s collaborator Fibrocell Science, Inc. FCSC reported encouraging interim results in its phase I/II clinical study of its gene therapy FCX-007, for the treatment of recessive dystrophic epidermolysis bullosa.

Zacks Rank & Stock to Consider

Intrexon carries a Zacks Rank #4 (Sell).

A better-ranked health care stocks in the same space is Ligand Pharmaceuticals Incorporated LGND holding a Zacks Rank #2 (Buy),. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Ligand’s earnings per share estimates have moved up $3.68 to $3.70 for 2018 over the last 30 days. The company pulled off positive earnings surprises in two of the trailing four quarters, with an average beat of 6.19%. The share price of the company has increased 42.5% year to date.

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