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Pacific Biosciences (PACB) Up 2.7% Since Last Earnings Report: Can It Continue?

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It has been about a month since the last earnings report for Pacific Biosciences of California (PACB - Free Report) . Shares have added about 2.7% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Pacific Biosciences 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.

Pacific Biosciences Q3 Loss Widens, Revenues Rise Y/Y

Pacific Biosciences incurred third-quarter 2019 adjusted loss of 19 cents per share, wider than the Zacks Consensus Estimate of a loss of 15 cents. The company had reported a loss of 19 cents a year ago.

Revenues totaled $21.9 million, which missed the Zacks Consensus Estimate by 21.8%. Revenues improved 20.7% from the year-ago quarter’s tally.

Segmental Analysis

Product Revenue: At this segment, revenues amounted to $18.5 million, up 22% from the prior-year quarter’s tally.

Service and Other Revenue: At this segment, revenues came in at $3.4 million, up 14% year over year.

Margin Analysis

Gross profit in the third quarter of 2019 was $6.9 million, up a significant 116.6% on a year-over-year basis. Gross margin was 31.5% of total revenues, improving significantly from the year-ago quarter’s 17.6%.

Research and Development expenses increased 4.2% to $15 million in the quarter. Further, sales, general and administrative expenses rose 48.6% to $20.1 million.

Operating expenses totaled $35 million, up 25.7% year over year.

How Have Estimates Been Moving Since Then?

It turns out, estimates review have trended downward during the past month. The consensus estimate has shifted -14.82% due to these changes.

VGM Scores

Currently, Pacific Biosciences has an average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. Following the exact same course, the stock was allocated a grade of F on the value side, putting it in the lowest quintile 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, Pacific Biosciences has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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