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Drug, Biotech Stocks' Q1 Earnings on May 4: REGN, ZTS & More

The earnings season for the drug/biotech sector is now in full swing. Several biotech companies due to report their first-quarter results.

As far as the large drugmakers in the drug/biotech sector are concerned, it was a mixed earnings season for them, with many companies beating estimates for earnings but missing the same for sales and vice versa. Most large drugmakers maintained their previously issued financial guidance for 2023 despite the uncertain macro environment.

Per the Zacks classification, the pharma/biotech industry comes under the broader Medical sector, which comprises pharma/biotech as well as medical device companies.

As of Apr 26, per the Earnings Trends report, 26.3% of the Medical sector participants, constituting 40.5% of the sector’s market capitalization, have already reported earnings. While 86.7% of the companies beat on earnings, 100% surpassed on revenues. Earnings decreased 3.5% year over year, while revenues rose 9.4%.

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Overall, first-quarter earnings of the Medical sector are expected to decline 21.1%, while sales are projected to increase 2.5%.

Here we discuss four large drug/biotech companies, Regeneron Pharmaceuticals REGN, Zoetis ZTS, Moderna MRNA, and Novo Nordisk NVO, which are set to report first-quarter results on May 4.

Regeneron Pharmaceuticals

Regeneron has an impressive track record, beating on earnings in all the past four quarters. In the last reported quarter, it beat earnings expectations by 29.75%. It surpassed earnings estimates by 20.44%, on average, in the trailing four quarters.

Regeneron Pharmaceuticals, Inc. Price and EPS Surprise

Regeneron Pharmaceuticals, Inc. Price and EPS Surprise
Regeneron Pharmaceuticals, Inc. Price and EPS Surprise

Regeneron Pharmaceuticals, Inc. price-eps-surprise | Regeneron Pharmaceuticals, Inc. Quote

Per our proven model, companies 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 an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Regeneron has an Earnings ESP of +4.41% and a Zacks Rank #3, suggesting a likely earning beat. The Zacks Consensus Estimate for earnings stands at $9.25 per share.

Regeneron’s top-line growth in the first quarter is likely to have been driven by the strong sales performance of eye drug Eylea and immunology medicine, Dupixent. However, Eylea’s sales in the first quarter are likely to have faced competitive pressure. Sales of Dupixent were up 39.7% in the first quarter as recorded by partner Sanofi. Hence, Regeneron is likely to have recorded incremental profits in the yet-to-be-reported quarter.

Zoetis

This veterinary drugmaker has a mixed track record, having missed earnings in two of the past four quarters while beating in one and delivering in-line results in one. In the last reported quarter, it delivered in-line results. It beat earnings estimates by 1.04%, on average, in the last four quarters.

Zoetis Inc. Price and EPS Surprise

Zoetis Inc. Price and EPS Surprise
Zoetis Inc. Price and EPS Surprise

Zoetis Inc. price-eps-surprise | Zoetis Inc. Quote

Zoetis has an Earnings ESP of +0.55% and a Zacks Rank #3. The Zacks Consensus Estimate stands at $1.27 per share.

Improved sales of Apoquel and Cytopoint brands must have boosted the dermatology portfolio in the first quarter. Zoetis’ Companion Animal business has also been performing well. This is primarily due to higher sales of Simparica Trio, a triple combination parasiticide for dogs, and the recent launches of its mAb therapies, Librela and Solensia. Such developments are likely to have driven growth in the to-be-reported quarter.

Moderna

Moderna’s surprise history has been mixed, with earnings beating estimates in two of the trailing four quarters while missing on the other two occasions. The average surprise is 10.69%.

Moderna, Inc. Price and EPS Surprise

Moderna, Inc. Price and EPS Surprise
Moderna, Inc. Price and EPS Surprise

Moderna, Inc. price-eps-surprise | Moderna, Inc. Quote

Moderna has an Earnings ESP of +6.83% and a Zacks Rank #3, indicating a likely earnings surprise. The Zacks Consensus Estimate stands at a loss of $1.77 per share.

Moderna’s sales in the first quarter are likely to have declined year over year due to declining demand for its mRNA-based COVID-19 vaccine. Investors will be keen on getting an update on mRNA-1010, the company’s seasonal influenza vaccine candidate.

Novo Nordisk

Novo Nordisk’s surprise history has been encouraging so far, with its earnings beating the Zacks Consensus Estimate in three of the trailing four quarters and missing the mark in the remaining one, delivering an average beat of 3.00%. In the last reported quarter, Novo Nordisk delivered an earnings surprise of 2.47%.

Novo Nordisk A/S Price and EPS Surprise

Novo Nordisk A/S Price and EPS Surprise
Novo Nordisk A/S Price and EPS Surprise

Novo Nordisk A/S price-eps-surprise | Novo Nordisk A/S Quote

Novo Nordisk has an Earnings ESP of 0.00% and has a Zacks Rank #1. The Zacks Consensus Estimate is pegged at $1.30 per share.

Novo Nordisk’s revenues in the first quarter are likely to have been driven by higher sales of Diabetes and Obesity Care products. Diabetes medicines like Rybelsus, Ozempic and Victoza are expected to have put up a strong performance in the first quarter of 2023 as well. Its new obesity medicine, Wegovy is likely to have generated significant sales in the first quarter driven by strong demand trends.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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Regeneron Pharmaceuticals, Inc. (REGN) : Free Stock Analysis Report

Novo Nordisk A/S (NVO) : Free Stock Analysis Report

Moderna, Inc. (MRNA) : Free Stock Analysis Report

Zoetis Inc. (ZTS) : Free Stock Analysis Report

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