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What's in the Cards for Sunesis (SNSS) This Earnings Season?

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Sunesis Pharmaceuticals, Inc.  is scheduled to report first-quarter 2019 results on May 8, after market closes.

The company beat the Zacks Consensus Estimate in all the last four quarters with the average positive surprise being 25.74%.

Shares of Sunesis have surged 239.2% so far this year compared with the industry‘s rise of 4.7%.

 

 

In the last reported quarter, Sunesis reported a positive earnings surprise of 27.27%.

Let’s see how things are shaping up for this announcement.

Things to Watch Out For

Investors will likely focus on the progress of the company’s lead pipeline candidate, vecabrutinib, on the first-quarter earnings call.

Sunesis is currently evaluating BTK inhibitor, vecabrutinib, in a phase Ib/II study as a third or later-line treatment for advanced B-cell malignancies including relapsed/refractory chronic lymphocytic leukemia (r/r CLL). In January, the company added a cohort in the study to evaluate 100mg dosage of the candidate in patients with r/r CLL and other B-cell malignancies. Please note that the company is developing the candidate in collaboration with Biogen (BIIB - Free Report) .

Sunesis has another pipeline candidate, TAK-580, which is being developed in collaboration with Takeda (TAK - Free Report) for treating pediatric low-grade glioma.

Ongoing clinical studies on vecabrutinib and TAK-580 are likely to drive operating expenses higher in the first quarter. However, lower expenses due to suspended development, following withdrawal of marketing application in Europe in 2017, of another cancer candidate, vosaroxin, may offset costs related to ongoing studies.

Earnings Whispers

Our proven model does not conclusively show that Sunesis is likely to beat estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to be able to beat estimates. But that is not the case here, as you will see below.

Earnings ESP: Sunesis’ Earnings ESP is 0.00%. This is because both the Most Accurate Estimate and the Zacks Consensus Estimate stand at a loss of 18 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Although Sunesis’ Zacks Rank #2 increases the predictive power of ESP, its 0.00% ESP makes surprise prediction difficult.

Note that we caution against stocks with a Zacks Rank #4 (Sell) or 5 (Strong Sell) going into an earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks That Warrant a Look

Here are some biotech stocks that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat in their upcoming releases.

Gilead Sciences, Inc. (GILD - Free Report) has an Earnings ESP of +1.54% and a Zacks Rank #2. The company is scheduled to release first-quarter results on May 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

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