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Why Is Intercept (ICPT) Up 4% Since Last Earnings Report?

Zimmer (ZBH) reported earnings 30 days ago. What's next for the stock? We take a look at earnings estimates for some clues.

It has been about a month since the last earnings report for Intercept Pharmaceuticals (ICPT). Shares have added about 4% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Intercept 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 catalysts.

Intercept Beats on Earnings And Sales

Intercept reported a loss of $2.18 per share in the third quarter, narrower than the Zacks Consensus Estimate of a loss of $2.65 and the year-ago loss of $2.89.

Quarterly revenues were $47 million, up from $41.3 million in the year-ago quarter. Revenues also surpassed the Zacks Consensus Estimate of $46.6 million.

Quarter in Detail

Ocaliva recorded $46.6 million of sales, up from $43.2 million recorded in the second quarter of 2018 and $40.9 million in the year-ago quarter. Net sales in the United States came in at $36.7 million, while the ex-U.S. Ocaliva net sales came in at $9.9 million.

Ocaliva in combination with ursodeoxycholic (UDCA) was approved in the United States for the treatment of primary biliary cholangitis (“PBC”) in adults with an inadequate response to UDCA, or as monotherapy in adults who are unable to endure UDCA, in 2016. The drug was also granted conditional approval by the European Commission. In February 2018, Ocaliva’s label was updated in the United States, to include a boxed warning and a dosing table that reinforced the existing dosing schedule in PBC patients with Child-Pugh Class B or C, or decompensated cirrhosis.

Research and development expenses increased 4.1% year over year to $47.9 million, primarily driven by increases in clinical development programs for Ocaliva. Selling, general and administrative expenses however decreased 7.5% to $56.8 million.

2018 Outlook Reiterated

Ocaliva’s net sales are expected between $170 million and $185 million in 2018. Intercept continues to expect operating expenses to be $390-$410 million in 2018.

Pipeline Update

Ocaliva is also being evaluated for other indications, including non-alcoholic steatohepatitis (“NASH”) and primary sclerosing cholangitis (“PSC”).

The phase III NASH program includes the REGENERATE trial among patients with advanced liver fibrosis and the REVERSE trial among patients with compensated cirrhosis. The FDA earlier approved a redesign of the phase III REGENERATE trial on Ocaliva for the safety and efficacy in treating NASH patients with liver fibrosis. The company now needs to achieve only one co-primary endpoint, either fibrosis improvement or NASH resolution compared with the earlier target of achieving both. Results from the REGENERATE trial are expected in the first half of 2019. The REVERSE trial is designed to evaluate the efficacy and safety of Ocaliva in NASH patients with compensated cirrhosis. The trial is currently enrolling.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in fresh estimates. The consensus estimate has shifted 6.89% due to these changes.

VGM Scores

At this time, Intercept has an average Growth Score of C, however its Momentum Score is doing a bit better with a B. However, the stock was allocated a grade of F on the value side, putting it in the lowest 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.


Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Intercept has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

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