It has been about a month since the last earnings report for Esperion Therapeutics (ESPR). Shares have lost about 16.7% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Esperion Therapeutics due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Q3 Earnings Beat Estimates, Revenues Miss
Esperion incurred a loss per share of 81 cents per share for the third quarter of 2022, narrower than the Zacks Consensus Estimate and our model estimate of a loss of 93 cents per share and 88 cents, respectively. The company reported a loss of $2.62 per share in the year-ago period.
Esperion generated revenues of $19.0 million, up 31.7% year over year. However, the reported figures missed the Zacks Consensus Estimate and our model estimates of $19.8 million and $21.2 million, respectively.
Quarter in Detail
Product revenues, solely from the United States, were $14.0 million in the third quarter, up approximately 28.2% year over year. Product revenues were up 2.8% sequentially.
Esperion recorded royalty revenues of $1.6 million during the reported quarter, compared with $1.5 million in the year-ago quarter. Royalty revenues were driven by the commercial launch of Nilemdo and Nustendi in new countries and growth in previously-launched territories.
Research and development (R&D) expenses increased 15% from the year-ago period’s levels to $29.1 million. This was caused by an increase in costs for the CLEAR cardiovascular outcomes study (CVOT), which ESPR is conducting.
Selling, general and administrative expenses (SG&A) were down 36% year over year to $25.0 million, reflecting the positive impact of its cost-savings programs as part of its transformational plan announced in the fourth quarter of 2021.
As of Sep 30, 2022, Esperion had cash, cash equivalents, restricted cash and investment securities of $239.3 million compared with cash, cash equivalents and short-term investments of $235.8 million as of Jun 30, 2022.
2022 Guidance Maintained
Esperion maintained its previous guidance for R&D and SG&A costs in 2022. The company expects R&D expense for 2022 to be in the range of $100-$110 million, while SG&A expense is expected to be between $120 million and $130 million.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month.
At this time, Esperion Therapeutics 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 broadly trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Esperion Therapeutics has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
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