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Tetraphase (TTPH) to Post Q1 Earnings: What's in the Cards?

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Zacks Equity Research
·4 min read
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We expect investors to focus on Tetraphase Pharmaceuticals, Inc.’s TTPH progress and the uptake of its product Xerava when it reports first-quarter 2020 earnings results.

Tetraphase’s performance over the last four quarters has been mixed with the company surpassing expectations thrice and missing the same once, the average positive surprise being 13.26%. In the last reported quarter, Tetraphase reported a positive earnings surprise of 51.58%.

Shares of Tetraphase have plunged 55.1% so far this year compared with the industry’s decrease of 13%.


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

Factors to Note

In the last reported quarter, Tetraphase witnessed a decline in annual revenues due to reduction in the up-front and regulatory milestone fees received from Everest Medicines and the wind-down of its government awards and grants and related revenues. It remains to be seen whether this downtrend continued in the soon-to-be-reported quarter as well.

However, sales of its only marketed medicine, Xerava (eravacycline for injection), which is indicated for the treatment of complicated intra-abdominal infections (cIAI) in patients aged 18 years and above, has been rising sequentially as well as on a yearly basis. This uptrend is most likely to have been consistent in the soon-to-be-reported quarter as well.

Recent Developments

In March 2020, Tetraphase announced a definitive merger agreement with California-based specialty pharmaceutical company AcelRx Pharmaceuticals ACRX.

Per the agreement, AcelRx agreed to acquire Tetraphase in an all-stock transaction valued at approximately $14.4 million. AcelRx shareholders will own 85.4% of the combined entity while Tetraphase equity holders will have 14.6% stake.

The transaction is expected to close in the second quarter of 2020, subject to customary closing conditions. Investors will be keen to get an update on the same during Tetraphase’s upcoming earnings call.

Earnings Whispers

Our proven model does not conclusively predict an earnings beat for Tetraphase this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of a positive surprise. But this is not the case here.

Earnings ESP: Tetraphase has an Earnings ESP of 0.00% as both the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at a loss of $1.63 per share. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.

Zacks Rank: Tetraphase sports a Zacks Rank #1.

Tetraphase Pharmaceuticals, Inc. Price and EPS Surprise

Tetraphase Pharmaceuticals, Inc. Price and EPS Surprise
Tetraphase Pharmaceuticals, Inc. Price and EPS Surprise

Tetraphase Pharmaceuticals, Inc. price-eps-surprise | Tetraphase Pharmaceuticals, Inc. Quote

Stocks to Consider

Here are some drug/biotech stocks that have the right combination of elements to beat on earnings this time around:

Alexion Pharmaceuticals, Inc. ALXN has an Earnings ESP of +1.08% and a Zacks Rank #2. The company is scheduled to release results on May 6. You can see the complete list of today’s Zacks #1 Rank stocks here.

Alnylam Pharmaceuticals, Inc. ALNY has an Earnings ESP of +4.44% and a Zacks Rank #3. The company is scheduled to release results on May 6.

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Alexion Pharmaceuticals, Inc. (ALXN) : Free Stock Analysis Report
 
Alnylam Pharmaceuticals, Inc. (ALNY) : Free Stock Analysis Report
 
AcelRx Pharmaceuticals, Inc. (ACRX) : Free Stock Analysis Report
 
Tetraphase Pharmaceuticals, Inc. (TTPH) : Free Stock Analysis Report
 
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