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Why Is Ligand (LGND) Up 4% Since Last Earnings Report?
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A month has gone by since the last earnings report for Ligand Pharmaceuticals . Shares have added about 4% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Ligand 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 drivers.
Q1 Earnings Beat, Sales Miss Estimates
Ligand reported core adjusted diluted net income per share of $1.20 in first-quarter 2024 from continuing operations. Although earnings declined 10% year over, the figure still beat the Zacks Consensus Estimate of $1.13.
Total revenues of $31.0 million were down 30% from the year-ago quarter’s levels. The reported figure missed the Zacks Consensus Estimate of $32.5 million.
The downside in earnings and sales was due to the receipt of a milestone payment from Travere Therapeutics in the year-ago period.
Quarterly Highlights
Royalty revenues were up 8% year over year to $19.1 million in the first quarter. The upside was driven by increased royalties from Amgen’s Kyprolis, Jazz Pharmaceuticals’ Rylaze, Merck’s Vaxneuvance and Travere’s Filspari.
Total Captisol sales were down 13% year over year to $9.2 million in the reported quarter due to the unfavorable timing of customer orders. During the quarter, the company did not record any Captisol sales related to COVID-19.
Contract revenues were down 83% year over year to $2.6 million in the first quarter. The downside was caused by the receipt of a milestone payment of $15.3 million from Travere Therapeutics upon the FDA’s accelerated approval for Filspari in IgAN indication in the year-ago period.
Research and development (R&D) expenses fell 10% to $6.0 million during the quarter, while general and administrative (G&A) expenses inched up 1% to $11.0 million.
Cash, cash equivalents and short-term investments amounted to $310.6 million as of Mar 31, 2024, compared with $170.3 million as of Dec 31, 2023.
2024 Guidance
Ligand reiterated its guidance for 2024. Total revenues are expected to be in the range of $130-$142 million.
Royalty revenues are expected to be in the $90-$95 million range, while contract revenues are expected to be in the range of $15 million and $20 million. The company expects Captisol sales to be between $25 million and $27 million.
The company also maintained its expectation for adjusted diluted EPS to $4.25-$4.75.
This guidance excludes Captisol sales related to COVID-19 and its impact on gross profit. Management will update investors as and when orders for COVID-19-related products are received.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
VGM Scores
Currently, Ligand has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. Charting a somewhat similar path, 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 F. 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, Ligand has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
Ligand is part of the Zacks Medical - Biomedical and Genetics industry. Over the past month, Geron (GERN - Free Report) , a stock from the same industry, has gained 5%. The company reported its results for the quarter ended March 2024 more than a month ago.
Geron reported revenues of $0.3 million in the last reported quarter, representing a year-over-year change of +1400%. EPS of -$0.09 for the same period compares with -$0.07 a year ago.
Geron is expected to post a loss of $0.11 per share for the current quarter, representing a year-over-year change of -22.2%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
Geron has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of F.
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Why Is Ligand (LGND) Up 4% Since Last Earnings Report?
A month has gone by since the last earnings report for Ligand Pharmaceuticals . Shares have added about 4% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Ligand 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 drivers.
Q1 Earnings Beat, Sales Miss Estimates
Ligand reported core adjusted diluted net income per share of $1.20 in first-quarter 2024 from continuing operations. Although earnings declined 10% year over, the figure still beat the Zacks Consensus Estimate of $1.13.
Total revenues of $31.0 million were down 30% from the year-ago quarter’s levels. The reported figure missed the Zacks Consensus Estimate of $32.5 million.
The downside in earnings and sales was due to the receipt of a milestone payment from Travere Therapeutics in the year-ago period.
Quarterly Highlights
Royalty revenues were up 8% year over year to $19.1 million in the first quarter. The upside was driven by increased royalties from Amgen’s Kyprolis, Jazz Pharmaceuticals’ Rylaze, Merck’s Vaxneuvance and Travere’s Filspari.
Total Captisol sales were down 13% year over year to $9.2 million in the reported quarter due to the unfavorable timing of customer orders. During the quarter, the company did not record any Captisol sales related to COVID-19.
Contract revenues were down 83% year over year to $2.6 million in the first quarter. The downside was caused by the receipt of a milestone payment of $15.3 million from Travere Therapeutics upon the FDA’s accelerated approval for Filspari in IgAN indication in the year-ago period.
Research and development (R&D) expenses fell 10% to $6.0 million during the quarter, while general and administrative (G&A) expenses inched up 1% to $11.0 million.
Cash, cash equivalents and short-term investments amounted to $310.6 million as of Mar 31, 2024, compared with $170.3 million as of Dec 31, 2023.
2024 Guidance
Ligand reiterated its guidance for 2024. Total revenues are expected to be in the range of $130-$142 million.
Royalty revenues are expected to be in the $90-$95 million range, while contract revenues are expected to be in the range of $15 million and $20 million. The company expects Captisol sales to be between $25 million and $27 million.
The company also maintained its expectation for adjusted diluted EPS to $4.25-$4.75.
This guidance excludes Captisol sales related to COVID-19 and its impact on gross profit. Management will update investors as and when orders for COVID-19-related products are received.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
VGM Scores
Currently, Ligand has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. Charting a somewhat similar path, 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 F. 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, Ligand has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
Ligand is part of the Zacks Medical - Biomedical and Genetics industry. Over the past month, Geron (GERN - Free Report) , a stock from the same industry, has gained 5%. The company reported its results for the quarter ended March 2024 more than a month ago.
Geron reported revenues of $0.3 million in the last reported quarter, representing a year-over-year change of +1400%. EPS of -$0.09 for the same period compares with -$0.07 a year ago.
Geron is expected to post a loss of $0.11 per share for the current quarter, representing a year-over-year change of -22.2%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
Geron has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of F.