The drug/biotech sector’s earnings season is approaching its end. Overall, it has been a good earnings season for the drug and biotech sector with many companies beating estimates on both counts. Some companies like J&J, Lilly and Pfizer raised their expectations for both earnings and sales.
Per the Zacks classification, the pharma/biotech industry comes under the broader
Medical sector, which comprises pharma/biotech as well as medical device companies.
Earnings Trends report as of Nov 3, 78.2% of the companies in the Medical sector, constituting nearly 84.4% of the sector’s market capitalization, reported earnings. While 90.7% beat earnings estimates, 79.1% beat the same for sales. Earnings increased 22.6% year over year on 13.7% higher revenues. Overall, third-quarter earnings for the Medical sector are expected to rise 28.7% on a 14.5% sales increase.
Let’s analyze four drug/biotech companies —
Viatris ( VTRS Quick Quote VTRS - Free Report) , Editas Medicine ( EDIT Quick Quote EDIT - Free Report) , Radius Health ( RDUS Quick Quote RDUS - Free Report) and Axsome Therapeutics ( AXSM Quick Quote AXSM - Free Report) — that are set to report third-quarter 2021 results on Nov 8. Viatris
The company was formed in November 2020 through the combination of Mylan and Upjohn, Pfizer’s business segment. It beat earnings estimates in each of the trailing three quarters, the average surprise being 14.2%. In the last-reported quarter, the company beat expectations by 11.36%.
This company has an
Earnings ESP of 0.00% and a Zacks Rank #3 (Hold).
The Zacks Consensus Estimate for earnings stands at 86 cents per share.
Per our proven model, stocks with the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) have a good chance of delivering earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our
Earnings ESP Filter.
Sales in each of Viatris’ geographical segments, Developed Markets, Emerging Markets and Greater China,
are likely to have improved sequentially in the third quarter from the second. Editas Medicine
The company’s earnings surprise history has been mixed so far, with its earnings beating estimates in two of the trailing four quarters and missing the same on the other two occasions, delivering an earnings surprise of 21.95%, on average. In the last-reported quarter, Editas delivered an earnings beat of 4.71%.
This Zacks Rank #3 company has an Earnings ESP of -1.31%. The Zacks Consensus Estimate stands at a loss of 86 cents per share.
With no approved product in its portfolio at the moment,
pipeline development remains the key focus for Editas. The company is developing its lead pipeline candidate, EDIT-101, which employs CRISPR gene editing to treat Leber congenital amaurosis type 10 (LCA10) — a rare genetic illness that causes blindness. Radius Health
The biotech’s performance has been mixed with earnings beating estimates in two of the trailing four quarters, missing in one and matching the same once. The company delivered a four-quarter negative earnings surprise of 3.61%, on average.
This Zacks Rank #3 company has an Earnings ESP of -16.98%. The Zacks Consensus Estimate stands at a loss of 27 cents per share.
The company beat estimates in two of the trailing four quarters, missed in one and met the same in one. The company delivered a four-quarter earnings surprise of 0.36%, on average.
Axsome has a Zacks Rank of 3 and an Earnings ESP of 0.00%. The Zacks Consensus Estimate stands at a loss of 94 cents share.