It has been about a month since the last earnings report for Fate Therapeutics (FATE Quick QuoteFATE - Free Report) . Shares have lost about 23.5% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Fate 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 drivers.

FATE Q2 Earnings Beat on Lower Expenses, Revenues Miss

Fate reported a loss of 54 cents per share in the second quarter of 2023, narrower than the Zacks Consensus Estimate of a loss of 58 cents and the year-ago quarter’s reported loss of 79 cents.

The loss narrowed year over year due to lower R&D expenses.

The company earned collaboration revenues of $0.9 million in the second quarter, which missed the Zacks Consensus Estimate of $7 million and was down from $18.5 million reported in the year-ago quarter.

Revenues were derived from the company’s preclinical development activities for a second collaboration candidate targeting an undisclosed solid tumor antigen under its collaboration with ONO Pharmaceutical.

R&D expenses declined 49.7% to $40.9 million from the year-ago quarter's level. G&A expenses increased 11.1% to $22.6 million.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates flatlined during the past month.

VGM Scores

At this time, Fate Therapeutics has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. However, the stock was allocated a grade of D on the value side, putting it in the bottom 40% 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.

Outlook

Fate Therapeutics has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Fate Therapeutics is part of the Zacks Medical - Biomedical and Genetics industry. Over the past month, Intercept Pharmaceuticals , a stock from the same industry, has gained 8.5%. The company reported its results for the quarter ended June 2023 more than a month ago.

Intercept reported revenues of $83.72 million in the last reported quarter, representing a year-over-year change of -16.6%. EPS of -$0.14 for the same period compares with -$0.68 a year ago.

For the current quarter, Intercept is expected to post a loss of $0.28 per share, indicating a change of +90.8% from the year-ago quarter. The Zacks Consensus Estimate has changed -5% over the last 30 days.

The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Intercept. Also, the stock has a VGM Score of C.