The reporting cycle for the first quarter of 2022 for the Medical sector is currently in full swing. The sector mainly comprises pharmaceutical/biotechnology and medical device companies.
With a slew of pharma and biotech bigwigs having already released results, the earnings picture looks reasonably good. Earlier this week, pharmaceutical giant Pfizer announced first quarter results. While PFE missed both earnings and sales, management maintained its previously released sales guidance for 2022. Biogen reported mixed results for the March quarter. While BIIB’s sales beat estimates, its earnings missed the mark, reflecting the impact of the write-off of its stock of Alzheimer’s drug, Aduhelm.
The earnings trend report says that as of April 20, 7% of companies in the medical sector—representing 27.6% of the sector’s market capitalization—reported quarterly earnings. While 100% of participants beat on profit, 75% outperform on revenue. Profits and revenues grew 8.4% and 13.5% respectively year over year. Overall, first-quarter medical earnings and sales are expected to rise 10.3% and 13.3% each from the respective figures released a year ago.
Vertex Pharmaceuticals VRTX, Zoetis ZTS, Vir Biotechnology VIR, Therapeutic Intellia NTLA and international endo ENDP is expected to publish its first quarter results on May 5.
Let’s analyze the performance of the aforementioned biotech/pharmaceutical companies.
Vertex Pharmaceuticals, which has an impressive earnings track record so far, is expected to report quarterly results after the market closes.
VRTX earnings have exceeded estimates in each of the past four quarters, averaging 10%. In the last reported quarter, Vertex’s earnings beat estimates by 2.7%.
Vertex Pharmaceuticals Incorporated price and EPS surprise
Vertex Pharmaceuticals Incorporated price-eps-surprise | Quote from Vertex Pharmaceuticals Incorporated
Our proven model indicates that the combination of a positive earnings ESP and a Zacks rank of #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can discover the best stocks to buy or sell before they’re flagged with our earnings ESP filter.
For the quarter to report, Vertex has an earnings ESP of +0.87% and a Zacks #2 ranking, implying a likely earnings surprise. Zacks’ consensus estimate for earnings stands at $3.60 per share. You can see the full list of today’s Zacks #1 Rank stocks here.
Revenue growth in the first quarter is expected to be driven by rapid adoption of Vertex’s newest cystic fibrosis drug, Trikafta/Kaftrio (the brand name of Trikafta in Europe), continuing the trend seen in recent quarters.
Zoetis, which is posting encouraging results to date, should publish its quarterly results before the opening of the markets.
ZTS earnings have exceeded estimates in each of the past four quarters, averaging 12.3%. In the last reported quarter, Zoetis’ earnings beat estimates by 4.2%.
Zoetis Inc. Award and EPS Surprise
Zoetis Inc. price-eps-surprise | Submission by Zoetis Inc.
For the quarter to report, Zoetis has an earnings ESP of +0.30% and a Zacks ranking of 3, indicating a likely earnings surprise. Zacks’ consensus estimate for earnings stands at $1.22 per share.
Strong sales in the dermatology portfolio due to increased sales of the Apoquel and Cytopoint brands bolstered the US segment in the last reported quarter, a trend that most likely continued in the first quarter as well. ZTS’ pet business has also been doing well for some time, primarily due to increased sales of Simparica Trio, a triple-combination parasiticide for dogs.
Vir Biotechnology, which has so far posted decent results, is expected to release its quarterly results after the closing bell.
VIR’s earnings have exceeded estimates in three of the last four quarters and missed the target on one occasion, with the average surprise being 29.5%. In the last reported quarter, Vir Biotechnology’s earnings exceeded estimates by 50.8%.
Vir Biotechnology, Inc. EPS Awards and Surprise
Vir Biotechnology, Inc. price-eps-surprise | Quotation from Vir Biotechnology, Inc.
For the quarter to report, Vir Biotechnology has an earnings ESP of -52.65% and a Zacks #5 ranking (strong sell). Zacks’ consensus estimate for earnings stands at $3.21 per share.
A key contributor to Vir’s first-quarter sales likely was collaboration revenue from its profit-sharing agreement with GlaxoSmithKline for the sale of Xevudy (sotrovimab) to treat COVID-19 infections.
Intellia Therapeutics, which has so far posted dismal results, is expected to release its quarterly results before the opening bell.
NTLA earnings have missed estimates in each of the past four quarters, with the average downside surprise being 26%. In the most recently reported quarter, Intellia Therapeutics’ earnings exceeded estimates by 19.8%.
Intellia Therapeutics, Inc. Awards and EPS Surprise
Intellia Therapeutics, Inc. price-eps-surprise | Quote from Intellia Therapeutics, Inc.
For the quarter to report, Intellia Therapeutics has an earnings ESP of 0.00% and a Zacks #3 ranking. The Zacks consensus estimate is pegged to a loss of $1.11 per share.
With no marketable products in its portfolio, we await an update on Intellia’s pipeline during the first quarter conference call, particularly on its core programs, namely NTLA-2001 (for amyloidosis at transthyretin) and NTLA-2002 (for hereditary angioedema).
Endo International, which has an impressive earnings record so far, is expected to release its quarterly results after the market close.
ENDP’s earnings have exceeded estimates in each of the past four quarters, averaging 50.2%. In the last reported quarter, Endo International’s earnings beat estimates by 20%.
Endo International plc Prize and EPS surprise
Endo International plc price-eps-surprise | Quote Endo International plc
For the reportable quarter, Endo International has an Earnings ESP of +11.36% and is ranked No. 3 on Zacks, indicating a likely earnings surprise. Zacks consensus estimate for earnings is 44 cents per share.
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Endo International plc (ENDP): Free Stock Analysis Report
Vertex Pharmaceuticals Incorporated (VRTX): Free Stock Analysis Report
Zoetis Inc. (ZTS): Free Stock Analysis Report
Intellia Therapeutics, Inc. (NTLA): Free Stock Analysis Report
Vir Biotechnology, Inc. (VIR): Free Stock Analysis Report
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