It has been about a month since the last earnings report for Global Blood Therapeutics (GBT). Shares have added about 6.2% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Global Blood 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.
Global Blood Reports Wider-Than-Expected Loss in Q2
Global Blood incurred a loss of $1.01 in the second quarter of 2019, which was wider than a loss of 78 cents reported in the year-ago quarter and the Zacks Consensus Estimate of a loss of 95 cents.
The company did not record any revenue during the quarter.
Research and development (R&D) expenses in the first quarter were $36 million, up 13.9% year over year.The increase in R&D expenses was mainly due to increased employee-related costs and higher costs associated with NDA filing activities.
G&A expenses in the second quarter were $24.8 million, up 127.5% year over year. The increase in expenses was due to higher employee-related costs, including non-cash stock compensation, and elevated expenditure associated with the buildout of the company’s commercial operations.
The company announced a final agreement with the FDA on the design of the post-approval confirmatory study of voxelotor, considering the TCD flow velocity as the primary endpoint.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review. The consensus estimate has shifted -5.07% due to these changes.
Currently, Global Blood has a poor Growth Score of F, however its Momentum Score is doing a bit better with a D. Following the exact same course, 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.
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Global Blood has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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