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Halozyme Therapeutics (HALO) Up 14.8% Since Last Earnings Report: Can It Continue?
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It has been about a month since the last earnings report for Halozyme Therapeutics (HALO - Free Report) . Shares have added about 14.8% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Halozyme Therapeutics 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 drivers.
Halozyme's Q2 Earnings & Sales Top Estimates
Halozyme reported second-quarter 2024 adjusted earnings of 91 cents per share, which surpassed the Zacks Consensus Estimate of 78 cents. The company had recorded earnings of 74 cents per share in the year-ago period.
Total revenues increased almost 5% year over year to $231.4 million in the second quarter. Revenues surpassed the Zacks Consensus Estimate of $211 million.
The top line was driven by higher royalty payments from Roche for Phesgo and higher sales of proprietary products. Revenues were partially offset by lower milestone payments from collaboration partners.
Quarter in Detail
Halozyme’s top line comprises product sales, royalties and revenues under collaborative agreements.
Royalty revenues totaled $124.9 million in the second quarter, up 12% from the year-ago quarter’s level. This was mainly due to the robust demand for Phesgo. Royalty revenues accounted for nearly 54% of the company’s total revenues in the reported quarter. Royalty revenues beat our model estimate of $116.3 million.
Product sales were $78.9 million, down 6.8% from the year-ago quarter figure. Product sales beat our model estimate of $69.4 million.
Revenues under collaborative agreements were $27.5 million in the second quarter, down 22.3% from $35.4 million reported in the year-ago quarter.
Adjusted EBITDA was $137 million in the second quarter, reflecting around 19% increase from the prior-year quarter.
Halozyme had cash, cash equivalents and marketable securities of $529 million as of Jun 30, 2024, compared with $463.5 million as of Mar 31, 2024.
2024 Guidance
Halozyme reiterated its 2024 guidance provided earlier this year.
The company continues to expect total revenues in the range of $935 million to $1.01 billion in 2024, implying year-over-year growth of 13% to 22%, based primarily on increases in royalty revenues, collaboration revenues and growth in product sales from Xyosted.
Halozyme anticipates royalty revenues in the range of $520-$555 million, implying year-over-year growth of 16% to 24%.
Adjusted EBITDA is expected between $555 million and $615 million in 2024, implying growth of 30% to 44% year over year.
The company expects adjusted earnings in the range of $3.65-$4.05 per share, indicating an improvement of 32% to 46% year over year. Halozyme’s earnings per share guidance does not consider the impact of potential future share repurchases.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted -5.93% due to these changes.
VGM Scores
Currently, Halozyme Therapeutics has an average Growth Score of C, however its Momentum Score is doing a lot better with an A. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. 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 these revisions indicates a downward shift. Notably, Halozyme 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
Halozyme Therapeutics belongs to the Zacks Medical - Biomedical and Genetics industry. Another stock from the same industry, Exact Sciences (EXAS - Free Report) , has gained 2% over the past month. More than a month has passed since the company reported results for the quarter ended June 2024.
Exact Sciences reported revenues of $699.26 million in the last reported quarter, representing a year-over-year change of +12.4%. EPS of -$0.09 for the same period compares with -$0.45 a year ago.
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Halozyme Therapeutics (HALO) Up 14.8% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Halozyme Therapeutics (HALO - Free Report) . Shares have added about 14.8% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Halozyme Therapeutics 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 drivers.
Halozyme's Q2 Earnings & Sales Top Estimates
Halozyme reported second-quarter 2024 adjusted earnings of 91 cents per share, which surpassed the Zacks Consensus Estimate of 78 cents. The company had recorded earnings of 74 cents per share in the year-ago period.
Total revenues increased almost 5% year over year to $231.4 million in the second quarter. Revenues surpassed the Zacks Consensus Estimate of $211 million.
The top line was driven by higher royalty payments from Roche for Phesgo and higher sales of proprietary products. Revenues were partially offset by lower milestone payments from collaboration partners.
Quarter in Detail
Halozyme’s top line comprises product sales, royalties and revenues under collaborative agreements.
Royalty revenues totaled $124.9 million in the second quarter, up 12% from the year-ago quarter’s level. This was mainly due to the robust demand for Phesgo. Royalty revenues accounted for nearly 54% of the company’s total revenues in the reported quarter. Royalty revenues beat our model estimate of $116.3 million.
Product sales were $78.9 million, down 6.8% from the year-ago quarter figure. Product sales beat our model estimate of $69.4 million.
Revenues under collaborative agreements were $27.5 million in the second quarter, down 22.3% from $35.4 million reported in the year-ago quarter.
Adjusted EBITDA was $137 million in the second quarter, reflecting around 19% increase from the prior-year quarter.
Halozyme had cash, cash equivalents and marketable securities of $529 million as of Jun 30, 2024, compared with $463.5 million as of Mar 31, 2024.
2024 Guidance
Halozyme reiterated its 2024 guidance provided earlier this year.
The company continues to expect total revenues in the range of $935 million to $1.01 billion in 2024, implying year-over-year growth of 13% to 22%, based primarily on increases in royalty revenues, collaboration revenues and growth in product sales from Xyosted.
Halozyme anticipates royalty revenues in the range of $520-$555 million, implying year-over-year growth of 16% to 24%.
Adjusted EBITDA is expected between $555 million and $615 million in 2024, implying growth of 30% to 44% year over year.
The company expects adjusted earnings in the range of $3.65-$4.05 per share, indicating an improvement of 32% to 46% year over year. Halozyme’s earnings per share guidance does not consider the impact of potential future share repurchases.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted -5.93% due to these changes.
VGM Scores
Currently, Halozyme Therapeutics has an average Growth Score of C, however its Momentum Score is doing a lot better with an A. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. 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 these revisions indicates a downward shift. Notably, Halozyme 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
Halozyme Therapeutics belongs to the Zacks Medical - Biomedical and Genetics industry. Another stock from the same industry, Exact Sciences (EXAS - Free Report) , has gained 2% over the past month. More than a month has passed since the company reported results for the quarter ended June 2024.
Exact Sciences reported revenues of $699.26 million in the last reported quarter, representing a year-over-year change of +12.4%. EPS of -$0.09 for the same period compares with -$0.45 a year ago.