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Mirati (MRTX) Down 15.7% Since Last Earnings Report: Can It Rebound?

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It has been about a month since the last earnings report for Mirati (MRTX). Shares have lost about 15.7% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Mirati 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.

Mirati’s Q4 Earnings & Revenues Beat Estimates

Mirati incurred a loss of $2.08 per share in the fourth quarter of 2020, narrower than the Zacks Consensus Estimate of a loss of $2.24 but wider than the year-ago quarter’s loss of $1.83.

The company generated $1.7 million as license and collaboration revenues in the fourth quarter owing to manufacturing supply services agreement with BeiGene. The top line surpassed the Zacks Consensus Estimate of $1 million.

Quarter in Detail

General and administrative expenses jumped 107.2% to $25.3 million due to higher share-based compensation expense and employee-related costs in the quarter. Research & development expenses also surged 31.4% to $82.7 million due to higher costs related to pipeline development and higher salary costs.

The company ended 2020 with $1.4 billion in cash and cash equivalents compared with $579.1 million as of Sep 30 2020.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in estimates review.

VGM Scores

Currently, Mirati has a poor Growth Score of F, a grade with the same score on the momentum front. Following the exact same course, 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

Estimates have been trending upward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Mirati has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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