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Why Is Acceleron (XLRN) Up 0.5% Since Last Earnings Report?

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A month has gone by since the last earnings report for Acceleron Pharma (XLRN). Shares have added about 0.5% in that time frame, underperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Acceleron due for a pullback? 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 drivers.

Acceleron Q4 Loss Wider Than Expected, Revenues Beat

The company reported collaboration revenues of $25.9 million in the reported quarter, decreasing from $39.3 million in the year-ago quarter but beating the Zacks Consensus Estimate by 0.71%.

Total revenues reported in the quarter include $23 million in royalty revenues from approximately $115 million of net sales of Reblozyl (luspatercept-aamt) from the company's partnership with Bristol Myers.

We remind investors that, in November 2019, the FDA approved Reblozyl for the treatment of anemia in adult patients with beta-thalassemia, who require regular red blood cell or RBC transfusions. The drug was developed in collaboration with Bristol Myers.

The FDA also approved the label expansion of Reblozyl for the treatment of anemia failing an erythropoiesis-stimulating agent and requiring two or more red blood cell (RBC) units over 8 weeks in adult patients with very low- to intermediate-risk MDS with ring sideroblasts (MDS-RS) or with myelodysplastic/myeloproliferative neoplasm with ring sideroblasts and thrombocytosis (MDS/MPN-RS-T).

Research and development costs increased to $57.2 million from $48.8 million in the year-ago quarter. Selling, general and administrative costs too increased to $26.2 million from $16 million in the year-ago quarter.

Cash, cash equivalents and investments as of Dec 31, 2020, were $857.5 million. Based on its current operating plans and projections, Acceleron believes that current cash, cash equivalents and investments along with expected royalty revenues from Reblozyl sales will be sufficient to fund projected operating requirements for the foreseeable future.


 

How Have Estimates Been Moving Since Then?

It turns out, estimates revision have trended downward during the past month. The consensus estimate has shifted -20.76% due to these changes.

VGM Scores

Currently, Acceleron has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. 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 F. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

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


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