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Assertio (ASRT) to Report Q2 Earnings: What's in the Cards?

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Assertio Holdings (ASRT - Free Report) will report second-quarter 2022 results on Aug 8, before market open.

In the second-quarter 2022 results, we expect investors to focus on the sales performance of Assertio’s marketed drugs and the restructuring initiatives taken by the company, which are expected to generate substantial annualized savings.

ASRT’s earnings surpassed expectations in two of the trailing four quarters and missed the same on the other two occasions, the average surprise being 26.39%. In the last reported quarter, Assertio Holdings posted an earnings surprise of 122.22%.

Assertio Holdings, Inc. Price, Consensus and EPS Surprise

 

Assertio Holdings, Inc. Price, Consensus and EPS Surprise

Assertio Holdings, Inc. price-consensus-eps-surprise-chart | Assertio Holdings, Inc. Quote

 

In the year so far, shares of Assertio Holdings have surged 57.8% against the industry’s 19.5% fall.

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Image Source: Zacks Investment Research

Let’s see how things have shaped up for the quarter to be reported.

Factors to Consider

Assertio Holdings currently has a differentiated product portfolio targeting various diseases.

Indocin, the company’s lead product, has been approved by the FDA for multiple indications, including rheumatoid arthritis, ankylosing spondylitis, osteoarthritis, bursitis, tendinitis and acute gouty arthritis. The regulatory body has approved the drug’s use in suppository and oral solution forms.

Assertio also markets other products, which include Cambia (for acute treatment of migraine attacks with or without aura), Otrexup (a single-dose injection containing methotrexate for treating rheumatoid arthritis and active polyarticular juvenileidiopathic arthritis) and Oxaydo, Sprix and Zipsor (for pain management).

The company generates revenues from three sources — product sales, royalties and milestones and other revenues.

In the last reported quarter, Assertio net product sales were up 37% year over year, driven by the addition of Otrexup to its portfolio and higher net pricing on Indocin. Otrexup accounted for nearly one-third of the company’s incremental product revenue growth in the first quarter of 2022.The trend is likely to have continued in the to-be-reported quarter. The Zacks Consensus Estimate for net product sales is currently pegged at $32.5 million.

In the last reported quarter, royalties and milestones were up 128% year over year. The Zacks Consensus for royalties and milestones is currently pegged at $0.41 million.

Last year in December, the company acquired Otrexup fromAntares Pharma. Otrexup is a strategic fit with Assertio Holdings’ unique digital platform, which is expected to drive the company's long-term growth starting in 2022.

Assertio Holdings announced a restructuring plan in December 2020. Its restructuring is now complete, which has resulted in significant cost savings and a reduction in overall operating expenses. This is anticipated to have boosted Assertio Holdings’ profits, helping the company achieve $45 million of annualized synergies starting in 2022.

With the completion of the restructuring initiative, the company underwent a massive transformation and shifted its focus on growing its business.

The company is expected to provide a further update on the same in the second-quarter earnings call.

Earnings Whispers

Our proven model does not conclusively predict an earnings beat for Assertio Holdings this time around. The combination of a positive Earnings ESPand a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. Unfortunately, that is not the case here, as you will see below. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Earnings ESP: Assertio Holdings has an Earnings ESP of 0.00% as the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at 8 cents per share.

Zacks Rank: Assertio Holdings currently flaunts a Zacks Rank #1.

Stocks to Consider

Here are some stocks in the same sector worth considering, as our model shows that these have the right combination of elements to beat on earnings this reporting cycle.

Verrica Pharmaceuticals (VRCA - Free Report) has an Earnings ESP of +7.94% and a Zacks Rank of 2.

Shares of Verrica have declined 62% in the year-to-date period. Earnings of VRCA beat earnings estimates in all the last four quarters, witnessing a negative surprise of 28.45%, on average.

Ionis Pharmaceuticals (IONS - Free Report) has an Earnings ESP of +27.61% and a Zacks Rank of 2.

Shares of Ionis Pharmaceuticals have returned 27% year to date. Earnings of IONSbeat estimates in two of the last four quarters and missed the mark on the other two occasions, witnessing a surprise of 24.35%, on average.

Neurocrine Biosciences (NBIX - Free Report) has an Earnings ESP of +40.43% and a Zacks Rank of 2.

Shares of Neurocrine have returned 12.2% in the year-to-date period. Earnings of NBIX missed earnings estimates in all the last four quarters, witnessing a negative surprise of 60.73%, on average.

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

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