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AstraZeneca (AZN) Q3 Earnings Miss Estimates, Sales Beat
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AstraZeneca’s (AZN - Free Report) third-quarter 2020 results were mixed as it missed estimates for earnings but beat the same for sales. The company maintained its previously issued revenue and earnings guidance for 2020.
Third-quarter 2020 core earnings of 47 cents per American depositary share missed the Zacks Consensus Estimate of 49 cents. Core earnings per share of 94 cents were flat year over year at constant exchange rates (“CER”).
Total revenues were up 3%, both on a reported and CER basis, to $6.58 billion in the quarter, driven by higher product sales. Revenues slightly beat the Zacks Consensus Estimate of $6.54 billion.
Shares of AstraZeneca were up 1.9% in pre-market trading on Nov 5, following the announcement of third-quarter results. This year so far, the company’s shares have risen 10.4% against a decrease of 6.2% for the industry.
All growth rates mentioned below are on a year-over-year basis and at CER.
Product Sales Rise
Product sales rose 7% at CER to $6.52 billion driven by higher sales of oncology medicines and diabetes drug, Farxiga, which made up for the decline in the Respiratory & Immunology franchise due to challenges facing Pulmicort in China.
Collaboration revenues were $58 million, down 78% at CER. This included collaboration revenues of $8 million for roxadustat and $27 million for Enhertu.
Among AstraZeneca’s various therapeutic areas, Oncology product sales were up 13%. In BioPharmaceuticals, New CVRM product sales were up 8% while Respiratory & Immunology declined 12%. Sales of other medicines declined 3%.
Sales in Detail
In Oncology, Lynparza product revenues rose 42% year over year to $464 million on the back of expanded use in ovarian and breast cancer and as the launch in prostate cancer began to take effect. AstraZeneca markets Lynparza in partnership with Merck (MRK - Free Report) .
Tagrisso recorded sales of $1.16 billion, up 30% year over year. Imfinzi generated sales of $533 million in the quarter, up 29% year over year mainly driven by strong demand in advanced lung cancer patients.
New drug Calquence generated sales of $145 million in the quarter compared with $107 million in the previous quarter. New drug, Koselugo, approved in April 2020, generated sales of $145 million in the quarter compared with $7 million in the previous quarter.
Iressa sales were down 40% to $54 million. Sales of older cancer drugs, Arimidex, Faslodex and Casodex declined while Zoladex increased.
In CVRM, Brilinta/Brilique sales were $385 million in the reported quarter, down 7% year over year due to the impact of COVID-19 and pricing pressure from the VBP (volume-based procurement) program in China.
Farxiga recorded product sales of $525 million in the quarter, up 35% year over year reflecting growth across all regions.
Crestor sales declined 10% to $300 million. Bydureon sales declined 14% to $110 million. Onglyza sales declined 13% to $109 million. Seloken sales increased 32% to $225 million. Atacand sales were up 4% to $54 million. Byetta sales were down 44% to $15 million.
In Respiratory & Immunology, Symbicort sales declined 2% in the quarter to $599 million due reversal of stockpiling benefits in the United States and generic competition in Japan.
Pulmicort sales declined 55% to $155 million reflecting a slowdown in hospital visits in China due to the coronavirus, especially the pediatric patients.
Fasenra recorded sales of $240 million in the quarter, up 18% year over year driven by market share growth and increased adoption of self-administration option, which offset the impact of lower new patient starts due to COVID-19.
Bevespi, a LAMA/LABA in a pressurized metered dose inhaler, recorded sales of $14 million in the quarter, up 36% year over year.
Breztri, which was launched in Japan in 2019 and China in 2020, recorded sales of $10 million in the quarter. Daliresp/Daxas rose 9% to $57 million in the quarter.
In Other Medicines, Nexium sales rose 9% to $401 million. Synagis fell 19% to $118 million.
Profit Discussion
AstraZeneca’s core gross margin of 79.4% was flat at CER. Core selling, general and administrative (SG&A) expenses declined 1% to $2.17 billion.
Core research and development (R&D) expenses rose 10% to $1.45 billion. Core operating profit declined 1% to $1.8 billion in the quarter. Core operating margin declined 1 percentage points to 27.3% in the quarter.
2020 View Maintained
AstraZeneca retained its guidance for total revenues and core EPS for 2020. AstraZeneca expects total revenues to grow in a high single-digit to a low double-digit range. The company expects core EPS to increase in a mid- to high-teens percentage. Currency changes are expected to have a low single-digit adverse impact on sales and core EPS in 2020.
However, AstraZeneca stated that the uncertainty from the impact of COVID-19 remains and performance between quarters may vary.
Update on Coronavirus Related Research Efforts
Last week, AstraZeneca announced that the FDA authorized to resume late-stage clinical studies on its COVID-19 vaccine candidate, AZD1222, in the United States. Last month, AstraZeneca temporarily paused all its global late-stage studies on AZD1222, which it is developing in partnership with Oxford University, as a patient in U.K. suffered an unspecified illness. While studies in UK, Brazil, South Africa and Japan resumed in the weeks thereafter following regulators’ confirmation, the study in the United States remained on hold. The FDA has now reviewed all safety data from the global studies and said it is safe to re-start the U.S. study. In the EU, a rolling review of data for AZD1222 has begun.
AstraZeneca has become one of the leading players in the field of coronavirus vaccine development. It has also signed advanced agreements with governments of several countries including United States, United Kingdom and other organizations to supply doses of the vaccine, if approved. The agreements will require it to produce almost three billion doses of the vaccine between now and the end of 2021.
Apart from the vaccine, the company, last month, began a phase III study on AZD7442, a monoclonal-antibody combination for the prevention and treatment of COVID-19. AZD7442 is a combination of two monoclonal antibodies, AZD8895 and AZD1061, which were derived from convalescent patients with SARS-CoV-2 infection, which AstraZeneca licensed from Vanderbilt University, in the United States in June 2020.
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
Image: Bigstock
AstraZeneca (AZN) Q3 Earnings Miss Estimates, Sales Beat
AstraZeneca’s (AZN - Free Report) third-quarter 2020 results were mixed as it missed estimates for earnings but beat the same for sales. The company maintained its previously issued revenue and earnings guidance for 2020.
Third-quarter 2020 core earnings of 47 cents per American depositary share missed the Zacks Consensus Estimate of 49 cents. Core earnings per share of 94 cents were flat year over year at constant exchange rates (“CER”).
Total revenues were up 3%, both on a reported and CER basis, to $6.58 billion in the quarter, driven by higher product sales. Revenues slightly beat the Zacks Consensus Estimate of $6.54 billion.
Shares of AstraZeneca were up 1.9% in pre-market trading on Nov 5, following the announcement of third-quarter results. This year so far, the company’s shares have risen 10.4% against a decrease of 6.2% for the industry.
All growth rates mentioned below are on a year-over-year basis and at CER.
Product Sales Rise
Product sales rose 7% at CER to $6.52 billion driven by higher sales of oncology medicines and diabetes drug, Farxiga, which made up for the decline in the Respiratory & Immunology franchise due to challenges facing Pulmicort in China.
Collaboration revenues were $58 million, down 78% at CER. This included collaboration revenues of $8 million for roxadustat and $27 million for Enhertu.
Among AstraZeneca’s various therapeutic areas, Oncology product sales were up 13%. In BioPharmaceuticals, New CVRM product sales were up 8% while Respiratory & Immunology declined 12%. Sales of other medicines declined 3%.
Sales in Detail
In Oncology, Lynparza product revenues rose 42% year over year to $464 million on the back of expanded use in ovarian and breast cancer and as the launch in prostate cancer began to take effect. AstraZeneca markets Lynparza in partnership with Merck (MRK - Free Report) .
Tagrisso recorded sales of $1.16 billion, up 30% year over year. Imfinzi generated sales of $533 million in the quarter, up 29% year over year mainly driven by strong demand in advanced lung cancer patients.
New drug Calquence generated sales of $145 million in the quarter compared with $107 million in the previous quarter. New drug, Koselugo, approved in April 2020, generated sales of $145 million in the quarter compared with $7 million in the previous quarter.
Iressa sales were down 40% to $54 million. Sales of older cancer drugs, Arimidex, Faslodex and Casodex declined while Zoladex increased.
In CVRM, Brilinta/Brilique sales were $385 million in the reported quarter, down 7% year over year due to the impact of COVID-19 and pricing pressure from the VBP (volume-based procurement) program in China.
Farxiga recorded product sales of $525 million in the quarter, up 35% year over year reflecting growth across all regions.
Crestor sales declined 10% to $300 million. Bydureon sales declined 14% to $110 million. Onglyza sales declined 13% to $109 million. Seloken sales increased 32% to $225 million. Atacand sales were up 4% to $54 million. Byetta sales were down 44% to $15 million.
In Respiratory & Immunology, Symbicort sales declined 2% in the quarter to $599 million due reversal of stockpiling benefits in the United States and generic competition in Japan.
Pulmicort sales declined 55% to $155 million reflecting a slowdown in hospital visits in China due to the coronavirus, especially the pediatric patients.
Fasenra recorded sales of $240 million in the quarter, up 18% year over year driven by market share growth and increased adoption of self-administration option, which offset the impact of lower new patient starts due to COVID-19.
Bevespi, a LAMA/LABA in a pressurized metered dose inhaler, recorded sales of $14 million in the quarter, up 36% year over year.
Breztri, which was launched in Japan in 2019 and China in 2020, recorded sales of $10 million in the quarter. Daliresp/Daxas rose 9% to $57 million in the quarter.
In Other Medicines, Nexium sales rose 9% to $401 million. Synagis fell 19% to $118 million.
Profit Discussion
AstraZeneca’s core gross margin of 79.4% was flat at CER. Core selling, general and administrative (SG&A) expenses declined 1% to $2.17 billion.
Core research and development (R&D) expenses rose 10% to $1.45 billion. Core operating profit declined 1% to $1.8 billion in the quarter. Core operating margin declined 1 percentage points to 27.3% in the quarter.
2020 View Maintained
AstraZeneca retained its guidance for total revenues and core EPS for 2020. AstraZeneca expects total revenues to grow in a high single-digit to a low double-digit range. The company expects core EPS to increase in a mid- to high-teens percentage. Currency changes are expected to have a low single-digit adverse impact on sales and core EPS in 2020.
However, AstraZeneca stated that the uncertainty from the impact of COVID-19 remains and performance between quarters may vary.
Update on Coronavirus Related Research Efforts
Last week, AstraZeneca announced that the FDA authorized to resume late-stage clinical studies on its COVID-19 vaccine candidate, AZD1222, in the United States. Last month, AstraZeneca temporarily paused all its global late-stage studies on AZD1222, which it is developing in partnership with Oxford University, as a patient in U.K. suffered an unspecified illness. While studies in UK, Brazil, South Africa and Japan resumed in the weeks thereafter following regulators’ confirmation, the study in the United States remained on hold. The FDA has now reviewed all safety data from the global studies and said it is safe to re-start the U.S. study. In the EU, a rolling review of data for AZD1222 has begun.
AstraZeneca has become one of the leading players in the field of coronavirus vaccine development. It has also signed advanced agreements with governments of several countries including United States, United Kingdom and other organizations to supply doses of the vaccine, if approved. The agreements will require it to produce almost three billion doses of the vaccine between now and the end of 2021.
Other leading players include Pfizer (PFE - Free Report) /BioNTech, Moderna and J&J (JNJ - Free Report) .
Apart from the vaccine, the company, last month, began a phase III study on AZD7442, a monoclonal-antibody combination for the prevention and treatment of COVID-19. AZD7442 is a combination of two monoclonal antibodies, AZD8895 and AZD1061, which were derived from convalescent patients with SARS-CoV-2 infection, which AstraZeneca licensed from Vanderbilt University, in the United States in June 2020.
Zacks Rank
AstraZeneca currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
AstraZeneca PLC Price, Consensus and EPS Surprise
AstraZeneca PLC price-consensus-eps-surprise-chart | AstraZeneca PLC Quote
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
See the 5 high-tech stocks now>>