Why Is Catalyst (CPRX) Down 5.3% Since Last Earnings Report?
A month has gone by since the last earnings report for Catalyst Pharmaceutical (CPRX). Shares have lost about 5.3% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Catalyst 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 drivers.
Catalyst's Q3 Earnings Beat Estimates, Sales Miss
Catalyst reported earnings of 13 cents per share in the third quarter of 2019, which beat the Zacks Consensus Estimate of 11 cents. The company reported a loss of 8 cents in the year-ago quarter.
The company’s revenues of $30.8 million missed the Zacks Consensus Estimate of $34 million. It did not record any revenue in the year-ago quarter. Revenues came entirely from Firdapse
Quarter in Detail
Per the company, Firdapse had a strong start. At the end of the third quarter, the drug was prescribed to 494 unique LEMS patients.
Research and development (R&D) expenses were $4.6 million, up from $4.5 million in the year-ago quarter.
Selling, general and administrative (SG&A) expenses totaled $8.1 million, up from $3.6 million in the year-ago quarter. The increase is attributable to higher selling expenses, including the costs of commercial system implementation of the company’s sales force and supporting personnel, product launch expenses, and market access and research costs.
The company expects SG&A expenses to increase in 2019 and 2020, as it continues to build the infrastructure and invest in commercial and patient programs to support Firdapse sales activities, and prosecutes its lawsuit against the FDA.
2019 and 2020 Guidance
Catalyst expects full-year 2019 net revenues to be approximately $100 million. It expects full-year 2020 net revenues to be in the range of $135-$155 million.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision flatlined during the past month. The consensus estimate has shifted -23.39% due to these changes.
VGM Scores
Currently, Catalyst has a great Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. However, 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.
Outlook
Catalyst has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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