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AVEO Oncology (AVEO) to Report Q3 Earnings: Is a Beat in Store?
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AVEO Oncology’s third-quarter revenues are likely to be driven by its newly launched drug, Fotivda launch, the only approved drug in its portfolio.
The company recently announced that it has entered into an agreement to be acquired by the Korean company LG Chem.
Pursuant to the agreement, LG Chem will acquire all outstanding shares of AVEO for $15.00 per share, or an approximate amount of $566 million, on a fully diluted basis, in an all-cash transaction. The transaction is expected to close early in 2023, subject to customary regulatory approvals. Post the completion of the deal, AVEO will no longer be listed as a separate company under Nasdaq.
AVEO Oncology’s earnings surpassed expectations in three of the trailing four quarters and missed the same on the remaining occasion, the average surprise being 13.10%. In the last reported quarter, AVEO posted an earnings surprise of 11.11%.
AVEO Pharmaceuticals, Inc. Price, Consensus and EPS Surprise
In the year so far, shares of AVEO Oncology have returned 215% against the industry’s 23.7% fall.
Image Source: Zacks Investment Research
Let’s see how things have shaped up for the quarter to be reported.
Factors to Consider
AVEO Oncology markets its only FDA-approved drug, Fotivda, for treating adults with relapsed or refractory advanced (R/R) and renal cell carcinoma (RCC), following two or more prior systemic therapies.
Fotivda has been witnessing a robust performance since its launch. The drug was approved by the FDA and commercially launched in the United States in March 2021. Fotivda is also approved for use in the European Union (EU), New Zealand and South Africa. We expect Fotivda to continue to register strong growth both in and outside the United States in the to-be-reported quarter. For the third quarter of 2022, the Zacks Consensus Estimate for net Fotivda product revenue is pegged at $29.06 million.
The company earns royalty revenues under its partnership agreements and collaborations. This is likely to have contributed to top-line growth in the third quarter of 2022. The Zacks Consensus Estimate for the same is pegged at $0.84 million for the to-be-reported quarter.
AVEO also has a portfolio of four wholly-owned clinical stage product candidates, ficlatuzumab, AV-380, AV-203, and AV-353, being developed for treating various forms of cancer.
AVEO Oncology entered into a clinical trial collaboration and supply agreement, in June, with Eli Lilly (LLY - Free Report) in North America to evaluate ficlatuzumab in combination with Lilly’s Erbitux (cetuximab) in patients with recurrent or metastatic head and neck squamous cell carcinoma (R/M HNSCC).
Per the agreement, Lilly will provide cetuximab clinical drug supply in the United States and Canada for AVEO’s potential registrational study. AVEO will serve as the study sponsor and would be responsible for trial execution.
Aveo Oncology witnessed a considerable rise in its research and development (R&D) expenses in the last reported quarter. The trend is likely to have continued in the third quarter due to the development plans of AVEO’s pipeline candidates.
Earnings Whisper
Our proven model conclusively predicts an earnings beat for AVEO Oncology this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
Earnings ESP: AVEO Oncology has an Earnings ESP of +8.16% as the Zacks Consensus Estimate of 16 cents is lower than the Most Accurate Estimate, which is pegged at a loss of 15 cents.
Here are some stocks in the same industry that have the right combination of elements to beat on earnings this time around:
Editas Medicine (EDIT - Free Report) has an Earnings ESP of +3.47% and a Zacks Rank #2.
Editas’ stock has declined 57.2% in the year so far. EDIT beat earnings expectations in each of the trailing four quarters, the average surprise being 17.82%.
Immunocore (IMCR - Free Report) has an Earnings ESP of 73.75% and a Zacks Rank #3 (Hold).
Immunocore’s stock has risen % in the year so far. IMCR beat earnings estimates in three of the trailing four quarters, missing the same in one. It has an average earnings surprise of 33.28%
Image: Bigstock
AVEO Oncology (AVEO) to Report Q3 Earnings: Is a Beat in Store?
AVEO Oncology’s third-quarter revenues are likely to be driven by its newly launched drug, Fotivda launch, the only approved drug in its portfolio.
The company recently announced that it has entered into an agreement to be acquired by the Korean company LG Chem.
Pursuant to the agreement, LG Chem will acquire all outstanding shares of AVEO for $15.00 per share, or an approximate amount of $566 million, on a fully diluted basis, in an all-cash transaction. The transaction is expected to close early in 2023, subject to customary regulatory approvals. Post the completion of the deal, AVEO will no longer be listed as a separate company under Nasdaq.
AVEO Oncology’s earnings surpassed expectations in three of the trailing four quarters and missed the same on the remaining occasion, the average surprise being 13.10%. In the last reported quarter, AVEO posted an earnings surprise of 11.11%.
AVEO Pharmaceuticals, Inc. Price, Consensus and EPS Surprise
AVEO Pharmaceuticals, Inc. price-consensus-eps-surprise-chart | AVEO Pharmaceuticals, Inc. Quote
In the year so far, shares of AVEO Oncology have returned 215% against the industry’s 23.7% fall.
Image Source: Zacks Investment Research
Let’s see how things have shaped up for the quarter to be reported.
Factors to Consider
AVEO Oncology markets its only FDA-approved drug, Fotivda, for treating adults with relapsed or refractory advanced (R/R) and renal cell carcinoma (RCC), following two or more prior systemic therapies.
Fotivda has been witnessing a robust performance since its launch. The drug was approved by the FDA and commercially launched in the United States in March 2021. Fotivda is also approved for use in the European Union (EU), New Zealand and South Africa. We expect Fotivda to continue to register strong growth both in and outside the United States in the to-be-reported quarter. For the third quarter of 2022, the Zacks Consensus Estimate for net Fotivda product revenue is pegged at $29.06 million.
The company earns royalty revenues under its partnership agreements and collaborations. This is likely to have contributed to top-line growth in the third quarter of 2022. The Zacks Consensus Estimate for the same is pegged at $0.84 million for the to-be-reported quarter.
AVEO also has a portfolio of four wholly-owned clinical stage product candidates, ficlatuzumab, AV-380, AV-203, and AV-353, being developed for treating various forms of cancer.
AVEO Oncology entered into a clinical trial collaboration and supply agreement, in June, with Eli Lilly (LLY - Free Report) in North America to evaluate ficlatuzumab in combination with Lilly’s Erbitux (cetuximab) in patients with recurrent or metastatic head and neck squamous cell carcinoma (R/M HNSCC).
Per the agreement, Lilly will provide cetuximab clinical drug supply in the United States and Canada for AVEO’s potential registrational study. AVEO will serve as the study sponsor and would be responsible for trial execution.
Aveo Oncology witnessed a considerable rise in its research and development (R&D) expenses in the last reported quarter. The trend is likely to have continued in the third quarter due to the development plans of AVEO’s pipeline candidates.
Earnings Whisper
Our proven model conclusively predicts an earnings beat for AVEO Oncology this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
Earnings ESP: AVEO Oncology has an Earnings ESP of +8.16% as the Zacks Consensus Estimate of 16 cents is lower than the Most Accurate Estimate, which is pegged at a loss of 15 cents.
Zacks Rank: AVEO currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Other Stocks to Consider
Here are some stocks in the same industry that have the right combination of elements to beat on earnings this time around:
Editas Medicine (EDIT - Free Report) has an Earnings ESP of +3.47% and a Zacks Rank #2.
Editas’ stock has declined 57.2% in the year so far. EDIT beat earnings expectations in each of the trailing four quarters, the average surprise being 17.82%.
Immunocore (IMCR - Free Report) has an Earnings ESP of 73.75% and a Zacks Rank #3 (Hold).
Immunocore’s stock has risen % in the year so far. IMCR beat earnings estimates in three of the trailing four quarters, missing the same in one. It has an average earnings surprise of 33.28%
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar