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Why Is Viatris (VTRS) Down 3.5% Since Last Earnings Report?
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A month has gone by since the last earnings report for Viatris (VTRS - Free Report) . Shares have lost about 3.5% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Viatris due for a breakout? 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.
Viatris' Q4 Earnings and Revenues Miss Estimates
Viatris posted adjusted earnings of 61 cents per share in the fourth quarter of 2023, missing the Zacks Consensus Estimate of 67 cents. The company recorded adjusted earnings of 67 cents in the year-ago quarter.
Total revenues came in at $3.8 billion, up 1% year over year on a divestiture-adjusted operational basis. Revenues include product sales and other revenues. The top line missed the Zacks Consensus Estimate of $3.9 million.
All growth rates mentioned below are on a year-over-year basis and adjusted for the impact of the biosimilars’ divestiture in November 2022. In November 2022, Viatris sold its biosimilars’ portfolio to Biocon Biologics Limited.
Quarter in Detail
The company reports results in four segments — Developed Markets, Emerging Markets, Japan, Australia and New Zealand (JANZ) and Greater China.
Sales from Developed Markets came in at $2.3 billion, down 1% from the year-ago quarter.
Sales from Emerging Markets came in at $619.1 million, up 14% from the year-ago quarter.
JANZ generated sales of $372.3 million, down 1% year over year.
Sales from Greater China came in at $515.3 million, up 2% year over year.
As regards revenue performance based on product category, revenues from Brands were up 4% year over year to $2.4 billion. Sales came in line with expectations due to a solid year-over-year performance in key brands like Yupelri, Lipitor and Dona.
Among these, Lipitor’s sales were $379.8 million, up 3% from the year-ago quarter. Yupelri sales came in at $60.5 million, up 8% year over year.
Generics, which include diversified product forms such as extended-release oral solids, injectables, transdermals and topicalsand complex generics, performed ahead of management’s expectations. Revenues from this business came in at $1.4 billion, down 3%.
Viatris generated $107 million in new generic product revenues, primarily driven by the launch of generic lenalidomide and Breyna (generic for Symbicort) in the United States.
The company paid down approximately $500 million in debt in the fourth quarter.
Adjusted gross margin came in at 57.5%, up 60 basis points year over year.
2023 Results
Revenues came in at $15.4 billion, down 5% year over year.
2024 Guidance
Total revenues are projected between $15.25 billion and $15.75 billion in 2024.
Adjusted earnings per share is expected in the range of $2.70-$2.85 in 2024.
Other Updates
In a separate press release, Viatris announced that it has entered into a global research and development collaboration with Swiss company Idorsia Ltd. The agreement grants Viatris exclusive global development and commercialization rights to two phase III assets, selatogrel and cenerimod, as well as the potential to add additional innovative assets in the future.
Selatogrel is a potential life-saving self-administered medicine for patients with a history of acute myocardial infarction (heart attack). Management believes that the addition of this investigational candidate complements Viatris' expertise in the cardiovascular field.
Meanwhile, Cenerimod is a novel immunology asset that has the potential to be a first-in-class oral therapy for the treatment of systemic lupus erythematosus, the most common form of lupus. Viatris also plans to study the candidate later for multiple other autoimmune indications.
The transaction is expected to close at the end of March, subject to certain limited closing conditions.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
The consensus estimate has shifted -7.33% due to these changes.
VGM Scores
At this time, Viatris has a poor Growth Score of F, a grade with the same score on the momentum front. However, the stock was allocated a grade of A on the value side, putting it in the top quintile 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 downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Viatris 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
Viatris belongs to the Zacks Medical Services industry. Another stock from the same industry, Avantor, Inc. (AVTR - Free Report) , has gained 3.8% over the past month. More than a month has passed since the company reported results for the quarter ended December 2023.
Avantor reported revenues of $1.72 billion in the last reported quarter, representing a year-over-year change of -4%. EPS of $0.25 for the same period compares with $0.32 a year ago.
For the current quarter, Avantor is expected to post earnings of $0.20 per share, indicating a change of -31% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Avantor. Also, the stock has a VGM Score of C.
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Why Is Viatris (VTRS) Down 3.5% Since Last Earnings Report?
A month has gone by since the last earnings report for Viatris (VTRS - Free Report) . Shares have lost about 3.5% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Viatris due for a breakout? 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.
Viatris' Q4 Earnings and Revenues Miss Estimates
Viatris posted adjusted earnings of 61 cents per share in the fourth quarter of 2023, missing the Zacks Consensus Estimate of 67 cents. The company recorded adjusted earnings of 67 cents in the year-ago quarter.
Total revenues came in at $3.8 billion, up 1% year over year on a divestiture-adjusted operational basis. Revenues include product sales and other revenues. The top line missed the Zacks Consensus Estimate of $3.9 million.
All growth rates mentioned below are on a year-over-year basis and adjusted for the impact of the biosimilars’ divestiture in November 2022. In November 2022, Viatris sold its biosimilars’ portfolio to Biocon Biologics Limited.
Quarter in Detail
The company reports results in four segments — Developed Markets, Emerging Markets, Japan, Australia and New Zealand (JANZ) and Greater China.
Sales from Developed Markets came in at $2.3 billion, down 1% from the year-ago quarter.
Sales from Emerging Markets came in at $619.1 million, up 14% from the year-ago quarter.
JANZ generated sales of $372.3 million, down 1% year over year.
Sales from Greater China came in at $515.3 million, up 2% year over year.
As regards revenue performance based on product category, revenues from Brands were up 4% year over year to $2.4 billion. Sales came in line with expectations due to a solid year-over-year performance in key brands like Yupelri, Lipitor and Dona.
Among these, Lipitor’s sales were $379.8 million, up 3% from the year-ago quarter. Yupelri sales came in at $60.5 million, up 8% year over year.
Generics, which include diversified product forms such as extended-release oral solids, injectables, transdermals and topicalsand complex generics, performed ahead of management’s expectations. Revenues from this business came in at $1.4 billion, down 3%.
Viatris generated $107 million in new generic product revenues, primarily driven by the launch of generic lenalidomide and Breyna (generic for Symbicort) in the United States.
The company paid down approximately $500 million in debt in the fourth quarter.
Adjusted gross margin came in at 57.5%, up 60 basis points year over year.
2023 Results
Revenues came in at $15.4 billion, down 5% year over year.
2024 Guidance
Total revenues are projected between $15.25 billion and $15.75 billion in 2024.
Adjusted earnings per share is expected in the range of $2.70-$2.85 in 2024.
Other Updates
In a separate press release, Viatris announced that it has entered into a global research and development collaboration with Swiss company Idorsia Ltd. The agreement grants Viatris exclusive global development and commercialization rights to two phase III assets, selatogrel and cenerimod, as well as the potential to add additional innovative assets in the future.
Selatogrel is a potential life-saving self-administered medicine for patients with a history of acute myocardial infarction (heart attack). Management believes that the addition of this investigational candidate complements Viatris' expertise in the cardiovascular field.
Meanwhile, Cenerimod is a novel immunology asset that has the potential to be a first-in-class oral therapy for the treatment of systemic lupus erythematosus, the most common form of lupus. Viatris also plans to study the candidate later for multiple other autoimmune indications.
The transaction is expected to close at the end of March, subject to certain limited closing conditions.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
The consensus estimate has shifted -7.33% due to these changes.
VGM Scores
At this time, Viatris has a poor Growth Score of F, a grade with the same score on the momentum front. However, the stock was allocated a grade of A on the value side, putting it in the top quintile 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 downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Viatris 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
Viatris belongs to the Zacks Medical Services industry. Another stock from the same industry, Avantor, Inc. (AVTR - Free Report) , has gained 3.8% over the past month. More than a month has passed since the company reported results for the quarter ended December 2023.
Avantor reported revenues of $1.72 billion in the last reported quarter, representing a year-over-year change of -4%. EPS of $0.25 for the same period compares with $0.32 a year ago.
For the current quarter, Avantor is expected to post earnings of $0.20 per share, indicating a change of -31% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Avantor. Also, the stock has a VGM Score of C.