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What's in the Cards for Amarin (AMRN) This Earnings Season?

Zacks Equity Research

Amarin Corporation PLC AMRN is scheduled to report second-quarter results on Jul 31, before market open.

Amarin’s earnings performance in the last four quarters was mixed, with the company beating estimates twice and missing the same on two occasions, delivering average negative surprise of 13.75%.

Shares of Amarin have outperformed the industry in the year so far. The stock has gained 35.9% compared with the industry’s increase of 0.7%.

In the last reported quarter, Amarin delivered a positive earnings surprise of 16.67%.

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

Earlier this month, Amarin provided preliminary results for the quarter. Demand for the company’s sole marketed drug, Vascepa, remains strong and sales are estimated between $97 million and $101 million. The estimated numbers indicate year-over-year growth of approximately 84%-92%.

Based on the encouraging preliminary numbers for Vascepa, the company also raised its sales guidance for 2019 to the range of $380 to $420 million from the previous guidance of $350 million provided on its first-quarter earnings call. The drug is approved as an adjunct to diet to reduce triglyceride levels in severe hypertriglyceridemia patients.

In May, the FDA granted priority review to the label expansion application looking to get approval for Vascepa to reduce cardiovascular risk in patients with persistent elevated triglycerides on statin therapy for LDL-C (bad cholesterol).

We expect Amarin’s activities to double its sales team and its multiple promotional and educational programs to support the launch of Vascepa to drive operating expenses higher in the soon-to-be reported quarter.

Investors will focus on update on payer coverage for Vascepa, expansion in Canada and Europe, and the impact of competition from other approved drugs, especially Sanofi  and Amgen’s PCSK9 inhibitors, Praluent and Repatha, respectively.

Earnings Whispers

Our proven model does not conclusively show that Amarin is likely to beat estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to be able to beat estimates. But that is not the case here, as you will see below.

Earnings ESP: Amarin’s Earnings ESP is 0.00%. This is because both the Most Accurate Estimate and the Zacks Consensus Estimate stand at a loss of 1 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Although Amarin’s Zacks Rank #3 increases the predictive power of ESP, its 0.00% ESP makes surprise prediction difficult.

Note that we caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into an earnings announcement, especially when the company is seeing negative estimate revisions.

Amarin Corporation PLC Price and Consensus

 

Amarin Corporation PLC Price and Consensus

Amarin Corporation PLC price-consensus-chart | Amarin Corporation PLC Quote

Stocks That Warrant a Look

Here are some pharma/biotech stocks that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat in their upcoming releases.

Gilead Sciences GILD has an Earnings ESP of +3.20% and a Zacks Rank #2. The company is scheduled to release second-quarter 2019 results on Jul 30. You can see the complete list of today’s Zacks #1 Rank stocks here.

Regeneron Pharmaceuticals REGN has an Earnings ESP of +6.25% and a Zacks Rank #3. The company is scheduled to release second-quarter 2019 results on Aug 6.

Allergan AGN has an Earnings ESP of +3.87% and a Zacks Rank #3.

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