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Why Is ImmunoGen (IMGN) Up 9.2% Since Last Earnings Report?

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A month has gone by since the last earnings report for ImmunoGen (IMGN). Shares have added about 9.2% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is ImmunoGen due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.

ImmunoGen Beats Q4 Earnings & Revenue Estimates

ImmunoGen reported earnings of 16 cents per share for the fourth quarter of 2020 compared with the year-ago earnings of 3 cents. The Zacks Consensus Estimate stood at a loss of 4 cents per share.

Revenues came in at $85.8 million, which also beat the Zacks Consensus Estimate of $51 million. Revenues were up 91.1% year over year, mainly driven by higher license and milestone fees.

Quarter in Details

For the fourth quarter, Immunogen reported license and milestone fees of $62.4 million compared with $29.6 million in the year-ago period. The significant rise was due to recognition of $60.5 million from Jazz Pharmaceuticals as upfront payment related to a collaboration agreement for hematology programs.

Fourth-quarter revenues included $23.4 million in non-cash royalty revenues, up 52.6% year over year, riding on rising global sales of its partner Roche’s Kadcyla.

During the quarter, research and development expenses increased 51.9% from the year-ago level to $39.6 million. The significant increase was due to higher clinical activity related to mirvetuximab soravtansine, and to support its potential commercial launch expected next year.

General and administrative expenses decreased 0.7% to $9.7 million in the fourth quarter of 2020.

ImmunoGen’s cash and cash equivalents increased to $293.9 million at the end of December 2020 compared with $188.2 million at the end of September 2020.

Full-Year Results

Immunogen reported revenues of $132.3 million, up 60.8% year over year. The company recorded a loss of 25 cents per share for 2020, 64.3% narrower than the year-ago period.

Issues 2021 Guidance

ImmunoGen provided its guidance for revenues, operating expenses and cash resources in 2021. The company expects revenues for the full year to be between $65 million and $75 million.

The company expects operating expense to be in the range of $200-$210 million. It expects cash and cash equivalents to be between $140 million and $150 million at 2021-end.

It expects cash resources to be enough to fund its operations through the second half of 2022.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in fresh estimates. The consensus estimate has shifted -17.39% due to these changes.

VGM Scores

Currently, ImmunoGen has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. Charting a somewhat similar path, the stock was allocated a grade of F on the value side, putting it in the bottom 20% quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of D. 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, ImmunoGen has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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