It has been about a month since the last earnings report for Alkermes (ALKS). Shares have added about 3.7% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Alkermes 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.
Q1 Earnings & Revenues Beat Estimates
Alkermes reported adjusted earnings of 1 cent per share, which outpaced the Zacks Consensus Estimate and our model estimates of a loss of 3 cents per share. The company reported adjusted earnings of 12 cents per share in the year-ago quarter.
Alkemes’ revenues of $287.6 million increased 3.27% from the year-ago quarter’s level. The top line beat the Zacks Consensus Estimate and our model estimates of $284 million and $275.7 million, respectively.
Quarter in Detail
Total manufacturing and royalty revenues decreased 31% year over year to $72.9 million. This was due to the termination of the license agreement related to the sale of long-acting Invega products in the United States by Janssen, a subsidiary of J&J.
Manufacturing and royalty revenues from Vumerity slightly declined 5.56% year over year to $28.9 million.
Sales of the proprietary drug, Vivitrol (for alcohol and opioid dependence), increased around 14% year over year to $96.7 million. The same for Aristada (for schizophrenia) surged almost 10% year over year to $80.1 million.
The newly approved medicine, Lybalvi (for schizophrenia or bipolar I disorder), generated sales of $38 million following its launch in October 2021. Sales of the drug rose 173% year over year, primarily driven by growth in demand.
Research and development expenses totaled $93.6 million, down almost 3% year over year.
Selling, general and administrative expenses amounted to $174.5 million, up almost 20% from that recorded in the year-ago quarter. This was due to increased investment to support the launch of Lybalvi.
The company reiterates its previously issued guidance for 2023. It expects total revenues in the range of $1.13-$1.25 billion.
Net sales for Vivitrol are expected in the band of $380-$410 million. The same for Aristada is anticipated in the $315–$345 million range. Lybalvi’s net sales are projected between $180 million and $205 million.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month.
The consensus estimate has shifted 22.35% due to these changes.
Currently, Alkermes has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% 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 broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Alkermes has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Alkermes belongs to the Zacks Medical - Biomedical and Genetics industry. Another stock from the same industry, Biogen Inc. (BIIB), has gained 1.2% over the past month. More than a month has passed since the company reported results for the quarter ended March 2023.
Biogen Inc. reported revenues of $2.46 billion in the last reported quarter, representing a year-over-year change of -2.7%. EPS of $3.40 for the same period compares with $3.62 a year ago.
For the current quarter, Biogen Inc. is expected to post earnings of $3.72 per share, indicating a change of -29.1% from the year-ago quarter. The Zacks Consensus Estimate has changed -0.8% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Biogen Inc. Also, the stock has a VGM Score of D.
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