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Incyte (INCY) Up 0.9% Since Last Earnings Report: Can It Continue?
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It has been about a month since the last earnings report for Incyte (INCY - Free Report) . Shares have added about 0.9% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Incyte due for a pullback? 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 catalysts.
Incyte's Q2 Earnings Lag Estimates, Revenues Top
Incyte reported second-quarter 2024 adjusted loss of $1.82 per share against the Zacks Consensus Estimate of earnings of 78 cents. The company had recorded earnings of 99 cents per share in the year-ago quarter.
Total revenues in the reported quarter were $1.04 billion, which grew 9% year over year, driven by the sustained performance of its lead drug, Jakafi (ruxolitinib), and increased sales of Opzelura (ruxolitinib) cream on strong launch and demand. The top line beat the Zacks Consensus Estimate of $1.02 billion.
Quarter in Detail
Jakafi’s (a first-in-class JAK1/JAK2 inhibitor approved for polycythemia vera, myelofibrosis and refractory acute graft-versus-host disease) revenues came in at $705.9 million, up 3% from the year-ago quarter’s level, owing to growth across all indications. Jakafi's sales beat the Zacks Consensus Estimate of $678 million.
Opzelura (ruxolitinib) cream generated $121.7 million in sales, which rose 52% year over year and surpassed the Zacks Consensus Estimate of $114 million. The year-over-year rise in sales was driven by patient demand, refills and expansion in payer coverage in both atopic dermatitis (AD) and vitiligo.
The newly approved medicine Zynyz (retifanlimab-dlwr) generated sales of $0.65 million. The company obtained accelerated approval for Zynyz to treat metastatic or recurrent locally advanced Merkel cell carcinoma.
Net product revenues of Iclusig were $26.9 million, down 8% year over year. The figure missed the Zacks Consensus Estimate of $30.1 million.
Pemazyre generated $20.3 million in sales, reflecting a year-over-year decrease of 6%. The figure marginally missed the Zacks Consensus Estimate of $20.6 million.
Minjuvi's revenues totaled $31.1 million, surging 136% from the prior year quarter’s number. The figure beat the Zacks Consensus Estimate of $28.5 million.
Incyte gained worldwide exclusive global rights for tafasitamab from MorphoSys AG. The drug is marketed as Monjuvi in the United States and as Minjuvi in the ex-U.S. markets.
We remind investors that Jakafi is marketed by Incyte in the United States and by Novartis as Jakavi in ex-U.S. markets.
Jakavi royalty revenues from Novartis (for commercialization in ex-U.S. markets) rose 10% to $99.3 million. Jakavi royalties beat the Zacks Consensus Estimate of $92 million.
Incyte also receives royalties from the sales of Tabrecta (capmatinib) for the treatment of adult patients with metastatic non-small-cell lung cancer. Its partner, Novartis, has exclusive worldwide development and commercialization rights for Tabrecta. The royalty revenues from the drug’s sales amounted to $5.3 million, up 10% year over year.
Olumiant’s (baricitinib) product royalty revenues from Eli Lilly totaled $31.7 million, down 1% year over year. The figure missed the Zacks Consensus Estimate of $33.5 million.
Incyte has a collaboration agreement with Eli Lilly for Olumiant.
The drug is a once-daily oral JAK inhibitor discovered by Incyte and licensed to LLY. It is approved for several types of autoimmune diseases.
Adjusted research and development expenses totaled $1,089 million, up 196% year over year. This increase was primarily due to a $679.4 million expense related to the IPR&D assets acquired as part of the Escient acquisition.
In May 2024, Incyte completed the acquisition of Escient Pharmaceuticals, a clinical-stage drug discovery and development company advancing novel small molecule therapeutics for systemic immune and neuro-immune disorders.
Adjusted selling, general and administrative expenses amounted to $262.6 million, almost in line with the prior-year quarter’s number.
As of Jun 30, 2024, Incyte’s cash and cash equivalents totaled $1.4 billion compared with $3.9 billion as of Mar 31, 2024.
2024 Guidance
Incyte raised the bottom end of the 2024 revenue guidance for Jakafi. The company now expects Jakafi revenues to be in the range of $2.71-$2.75 billion compared with the earlier projection of $2.69-$2.75 billion.
Adjusted research and development expenses are now expected to be in the band of $1.61-$1.65 billion compared with the earlier projection of $1.58-$1.61 billion. Adjusted selling, general and administrative expenses are projected to be in the range of $1.11-$1.14 billion.
Recent Updates
The acquisition of Escient Pharmaceuticals added EP262 and EP547 to INCY’s portfolio. EP262 is a first-in-class, potent, highly selective, once-daily small molecule antagonist of Mas-related G protein-coupled receptor X2 (MRGPRX2). The candidate is being evaluated to treat multiple mast cell-mediated diseases, including chronic inducible urticaria, chronic spontaneous urticaria and atopic dermatitis. EP547 is a first-in-class oral MRGPRX4 antagonist with the potential to treat cholestatic pruritus and other conditions with severe pruritus.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates review.
VGM Scores
Currently, Incyte has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% 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
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Incyte 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
Incyte is part of the Zacks Medical - Biomedical and Genetics industry. Over the past month, Alkermes (ALKS - Free Report) , a stock from the same industry, has gained 2.8%. The company reported its results for the quarter ended June 2024 more than a month ago.
Alkermes reported revenues of $399.13 million in the last reported quarter, representing a year-over-year change of -35.4%. EPS of $0.72 for the same period compares with $0.55 a year ago.
Alkermes is expected to post earnings of $0.81 per share for the current quarter, representing a year-over-year change of +26.6%. Over the last 30 days, the Zacks Consensus Estimate has changed +5.8%.
Alkermes has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of A.
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Incyte (INCY) Up 0.9% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Incyte (INCY - Free Report) . Shares have added about 0.9% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Incyte due for a pullback? 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 catalysts.
Incyte's Q2 Earnings Lag Estimates, Revenues Top
Incyte reported second-quarter 2024 adjusted loss of $1.82 per share against the Zacks Consensus Estimate of earnings of 78 cents. The company had recorded earnings of 99 cents per share in the year-ago quarter.
Total revenues in the reported quarter were $1.04 billion, which grew 9% year over year, driven by the sustained performance of its lead drug, Jakafi (ruxolitinib), and increased sales of Opzelura (ruxolitinib) cream on strong launch and demand. The top line beat the Zacks Consensus Estimate of $1.02 billion.
Quarter in Detail
Jakafi’s (a first-in-class JAK1/JAK2 inhibitor approved for polycythemia vera, myelofibrosis and refractory acute graft-versus-host disease) revenues came in at $705.9 million, up 3% from the year-ago quarter’s level, owing to growth across all indications. Jakafi's sales beat the Zacks Consensus Estimate of $678 million.
Opzelura (ruxolitinib) cream generated $121.7 million in sales, which rose 52% year over year and surpassed the Zacks Consensus Estimate of $114 million. The year-over-year rise in sales was driven by patient demand, refills and expansion in payer coverage in both atopic dermatitis (AD) and vitiligo.
The newly approved medicine Zynyz (retifanlimab-dlwr) generated sales of $0.65 million. The company obtained accelerated approval for Zynyz to treat metastatic or recurrent locally advanced Merkel cell carcinoma.
Net product revenues of Iclusig were $26.9 million, down 8% year over year. The figure missed the Zacks Consensus Estimate of $30.1 million.
Pemazyre generated $20.3 million in sales, reflecting a year-over-year decrease of 6%. The figure marginally missed the Zacks Consensus Estimate of $20.6 million.
Minjuvi's revenues totaled $31.1 million, surging 136% from the prior year quarter’s number. The figure beat the Zacks Consensus Estimate of $28.5 million.
Incyte gained worldwide exclusive global rights for tafasitamab from MorphoSys AG. The drug is marketed as Monjuvi in the United States and as Minjuvi in the ex-U.S. markets.
We remind investors that Jakafi is marketed by Incyte in the United States and by Novartis as Jakavi in ex-U.S. markets.
Jakavi royalty revenues from Novartis (for commercialization in ex-U.S. markets) rose 10% to $99.3 million. Jakavi royalties beat the Zacks Consensus Estimate of $92 million.
Incyte also receives royalties from the sales of Tabrecta (capmatinib) for the treatment of adult patients with metastatic non-small-cell lung cancer. Its partner, Novartis, has exclusive worldwide development and commercialization rights for Tabrecta. The royalty revenues from the drug’s sales amounted to $5.3 million, up 10% year over year.
Olumiant’s (baricitinib) product royalty revenues from Eli Lilly totaled $31.7 million, down 1% year over year. The figure missed the Zacks Consensus Estimate of $33.5 million.
Incyte has a collaboration agreement with Eli Lilly for Olumiant.
The drug is a once-daily oral JAK inhibitor discovered by Incyte and licensed to LLY. It is approved for several types of autoimmune diseases.
Adjusted research and development expenses totaled $1,089 million, up 196% year over year. This increase was primarily due to a $679.4 million expense related to the IPR&D assets acquired as part of the Escient acquisition.
In May 2024, Incyte completed the acquisition of Escient Pharmaceuticals, a clinical-stage drug discovery and development company advancing novel small molecule therapeutics for systemic immune and neuro-immune disorders.
Adjusted selling, general and administrative expenses amounted to $262.6 million, almost in line with the prior-year quarter’s number.
As of Jun 30, 2024, Incyte’s cash and cash equivalents totaled $1.4 billion compared with $3.9 billion as of Mar 31, 2024.
2024 Guidance
Incyte raised the bottom end of the 2024 revenue guidance for Jakafi. The company now expects Jakafi revenues to be in the range of $2.71-$2.75 billion compared with the earlier projection of $2.69-$2.75 billion.
Adjusted research and development expenses are now expected to be in the band of $1.61-$1.65 billion compared with the earlier projection of $1.58-$1.61 billion. Adjusted selling, general and administrative expenses are projected to be in the range of $1.11-$1.14 billion.
Recent Updates
The acquisition of Escient Pharmaceuticals added EP262 and EP547 to INCY’s portfolio. EP262 is a first-in-class, potent, highly selective, once-daily small molecule antagonist of Mas-related G protein-coupled receptor X2 (MRGPRX2). The candidate is being evaluated to treat multiple mast cell-mediated diseases, including chronic inducible urticaria, chronic spontaneous urticaria and atopic dermatitis. EP547 is a first-in-class oral MRGPRX4 antagonist with the potential to treat cholestatic pruritus and other conditions with severe pruritus.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates review.
VGM Scores
Currently, Incyte has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% 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
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Incyte 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
Incyte is part of the Zacks Medical - Biomedical and Genetics industry. Over the past month, Alkermes (ALKS - Free Report) , a stock from the same industry, has gained 2.8%. The company reported its results for the quarter ended June 2024 more than a month ago.
Alkermes reported revenues of $399.13 million in the last reported quarter, representing a year-over-year change of -35.4%. EPS of $0.72 for the same period compares with $0.55 a year ago.
Alkermes is expected to post earnings of $0.81 per share for the current quarter, representing a year-over-year change of +26.6%. Over the last 30 days, the Zacks Consensus Estimate has changed +5.8%.
Alkermes has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of A.