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United Therapeutics (UTHR) Up 2.3% Since Last Earnings Report: Can It Continue?
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It has been about a month since the last earnings report for United Therapeutics (UTHR - Free Report) . Shares have added about 2.3% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is United Therapeutics 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.
United Therapeutics Q3 Earnings & Sales Beat Estimates
United Therapeutics reported earnings of $3.84 per share for the third quarter of 2020, which comprehensively beat the Zacks Consensus Estimate of $2.41 per share and were higher than the year-ago earnings of $3.01 per share.
The abovementioned earnings include the impact of share-based compensation expenses, unrealized gains/losses on equity securities, license related fees, impairment charges and other items. Excluding these items, adjusted earnings were $3.88 per share, up 1% year over year.
Revenues for the reported quarter were $380.1 million, which beat the Zacks Consensus Estimate of $362 million. However, revenues fell 5% year over year.
While the company saw a decline in new prescriptions for Remodulin, Tyvaso and Orenitram in the month of April as patients were unable to visit their doctors, the number of new patient prescriptions grew to reach close to pre-pandemic levels toward the end of the third quarter. This led to higher U.S. revenues in the quarter. Meanwhile, the year-ago quarter revenues benefited from an “excess order” by a U.S. distributor, which significantly increased revenues in that quarter. Minus the excess order, sales growth of Remodulin, Tyvaso and Orenitram would have been higher in the third quarter of 2020.
Quarter in Detail
Orenitram sales amounted to $74.7 million in the reported quarter, up 20% year over year due higher volumes resulting from an expanded Orenitram label, reflecting the FREEDOM-EV results. Tyvaso sales totaled $129.5 million, up 17% year over year gaining from higher volumes as a result of patient growth and price increases.
Remodulin sales were $124.5 million, down 26% year over year due to lower volumes in Europe as a result of generic competition and the impact of COVID-19. U.S. revenues declined due to the excess order.
Adcirca sales were $13.8 million, down 54% year over year as generic competition resulted in continued erosion of market share in the quarter.
Unituxin’s (for the treatment of pediatric patients with high-risk neuroblastoma) sales of $37.6 million were up 25% year over year.
Research and development (R&D) expenses were $68.7 million in the quarter, down 20% year over year. Selling, general and administrative expense declined 33% to $66.3 million in the quarter.
Pipeline Update
Along with the earnings release, regarding its clinical studies, the company said that though enrollment of new patients has resumed at select study sites for certain studies after it was paused in the first quarter, it cannot predict when it will be able to re-open enrollment at additional sites for these studies. Meanwhile, enrollment in PERFECT study remains paused. Also, the company expects a delay in completion and data readouts for several ongoing studies.
Meanwhile, the timing of commercial launch of RemUnity has been delayed due to pandemic-related issues. The pandemic has hurt its partner, DEKA’s ability to secure certain components and raw materials necessary to build the pumps.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates. The consensus estimate has shifted 48.49% due to these changes.
VGM Scores
At this time, United Therapeutics has an average Growth Score of C, however its Momentum Score is doing a lot better with an A. However, 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 C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, United Therapeutics has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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United Therapeutics (UTHR) Up 2.3% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for United Therapeutics (UTHR - Free Report) . Shares have added about 2.3% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is United Therapeutics 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.
United Therapeutics Q3 Earnings & Sales Beat Estimates
United Therapeutics reported earnings of $3.84 per share for the third quarter of 2020, which comprehensively beat the Zacks Consensus Estimate of $2.41 per share and were higher than the year-ago earnings of $3.01 per share.
The abovementioned earnings include the impact of share-based compensation expenses, unrealized gains/losses on equity securities, license related fees, impairment charges and other items. Excluding these items, adjusted earnings were $3.88 per share, up 1% year over year.
Revenues for the reported quarter were $380.1 million, which beat the Zacks Consensus Estimate of $362 million. However, revenues fell 5% year over year.
While the company saw a decline in new prescriptions for Remodulin, Tyvaso and Orenitram in the month of April as patients were unable to visit their doctors, the number of new patient prescriptions grew to reach close to pre-pandemic levels toward the end of the third quarter. This led to higher U.S. revenues in the quarter. Meanwhile, the year-ago quarter revenues benefited from an “excess order” by a U.S. distributor, which significantly increased revenues in that quarter. Minus the excess order, sales growth of Remodulin, Tyvaso and Orenitram would have been higher in the third quarter of 2020.
Quarter in Detail
Orenitram sales amounted to $74.7 million in the reported quarter, up 20% year over year due higher volumes resulting from an expanded Orenitram label, reflecting the FREEDOM-EV results. Tyvaso sales totaled $129.5 million, up 17% year over year gaining from higher volumes as a result of patient growth and price increases.
Remodulin sales were $124.5 million, down 26% year over year due to lower volumes in Europe as a result of generic competition and the impact of COVID-19. U.S. revenues declined due to the excess order.
Adcirca sales were $13.8 million, down 54% year over year as generic competition resulted in continued erosion of market share in the quarter.
Unituxin’s (for the treatment of pediatric patients with high-risk neuroblastoma) sales of $37.6 million were up 25% year over year.
Research and development (R&D) expenses were $68.7 million in the quarter, down 20% year over year. Selling, general and administrative expense declined 33% to $66.3 million in the quarter.
Pipeline Update
Along with the earnings release, regarding its clinical studies, the company said that though enrollment of new patients has resumed at select study sites for certain studies after it was paused in the first quarter, it cannot predict when it will be able to re-open enrollment at additional sites for these studies. Meanwhile, enrollment in PERFECT study remains paused. Also, the company expects a delay in completion and data readouts for several ongoing studies.
Meanwhile, the timing of commercial launch of RemUnity has been delayed due to pandemic-related issues. The pandemic has hurt its partner, DEKA’s ability to secure certain components and raw materials necessary to build the pumps.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates. The consensus estimate has shifted 48.49% due to these changes.
VGM Scores
At this time, United Therapeutics has an average Growth Score of C, however its Momentum Score is doing a lot better with an A. However, 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 C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, United Therapeutics has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.