A month has gone by since the last earnings report for Puma Biotech (PBYI). Shares have lost about 53.9% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Puma Biotech due for a breakout? 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.
Puma Biotech Q1 Earnings Top, Nerlynx Disappoints
Puma Biotech incurred a loss of 26 cents per share for the first quarter of 2019, narrower than the Zacks Consensus Estimate of a loss of 69 cents as well as the year-ago loss of 65 cents.
Total revenues consist of both net product revenues from the sales of Nerlynx (neratinib) and the company’s license revenues. In the first quarter of 2019, total revenues came in at $99.1 million, comprising $45.6 million of product revenues from Nerlynx and $53.5 million of license revenues. Moreover, sales beat the Zacks Consensus Estimate of $65.0 million in the reported quarter and were also higher than the year-ago figure of $66.5 million.
Quarter in Detail
Sales of Nerlynx were down 25.4% on a sequential basis. Alan H. Auerbach, chief executive officer (CEO) of Puma Biotech attributed the disappointing performance to higher number of patients discontinuing treatment with Nerlynx. Also, an increase in expenses charged against gross revenues hurt sales in the quarter.
Total operating costs in the quarter were $89.2 million, up 0.8% year over year.
Research and development (R&D) expenses were $35.7 million, down 23.9% from the year-ago period owing to lower clinical study costs and stock-based compensation expenses.
Selling, general and administrative expenses increased 24.3% year over year to $45.5 million, primarily due to higher professional fees, stock-based compensation expenses and other costs.
As of Mar 31, 2019, Puma Biotech had cash and cash equivalents of $48.8 million compared with $108.4 million as of Dec 31, 2018.
How Have Estimates Been Moving Since Then?
Fresh estimates followed a downward path over the past two months. The consensus estimate has shifted -54.24% due to these changes.
At this time, Puma Biotech has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a C. Charting a somewhat similar path, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Puma Biotech has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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