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Sanofi (SNY) to Report Q1 Earnings: What's in the Cards?
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Sanofi (SNY - Free Report) will report first-quarter 2020 results on Apr 24, before market open. In the last reported quarter, the company delivered a positive earnings surprise of 5.71%.
The French drugmaker’s performance has been pretty impressive, with the company exceeding earnings expectations in each of the trailing four quarters. The company has a four-quarter positive earnings surprise of 9.27%, on average.
Sanofi stock has declined 3.2% this year so far compared with a decrease of 1.2% for the industry.
Factors to Consider
Sanofi’s Specialty Care and Vaccines units are likely to have performed well in first-quarter 2019, in turn, driving top-line growth. Meanwhile, persistent sluggishness in the Consumer Healthcare unit might reflect on the topline.
Sanofi’s Specialty Care segment sales are likely to have been driven by its blockbuster drug, Dupixent.
Sales of Dupixent in the quarter are likely to have been driven by growth in atopic dermatitis indication and rapid uptake in new indications —asthma and chronic rhinosinusitis with nasal polyposis in the United States. Please note that Sanofi markets Dupixent in partnership with Regeneron (REGN - Free Report) .
Sales of Sanofi’s rare disease and oncology drugs are likely to have increased in the first quarter. However, we do not expect the performance of Diabetes unit to have improved in the to-be-reported quarter. Sales of Sanofi’s diabetes drugs in the United States are declining due to pricing pressure and loss of Part D business. Higher rebates and lower prices are likely to have hurt sales of Sanofi/ Regeneron’s PCSK9 inhibitor, Praluent,
Also, generic/biosimilar headwinds might reflect on the Established Rx Products unit’s sales.
In the Consumer Healthcare unit, recall of its over-the-counter acid reflux medicine Zantac, non-core divestments and increased regulatory requirements, which resulted in product suspensions, are expected to have put pressure on the top line.
Overall, first-quarter 2020 results will reflect difficult year-over-year comparisons as sales in China had increased 22% in the first quarter of 2019.
Importantly, investors will also focus on whether Sanofi provides an updated business outlook for 2020 to include the impact of coronavirus on the call. There is a concern about supply chain disruptions, caused by the outbreak, hurting drug/biotech companies’ first-half earnings.
Meanwhile, with half of the world under a lockdown in the latter part of the quarter, a delay is expected in completion of clinical studies, which could further delay drug approvals and their launch. Investors will look for any such updates from Sanofi.
Key Q1 Developments
Sanofi and Glaxo (GSK - Free Report) signed a letter of intent to combine their innovative technologies to develop an adjuvanted COVID-19 vaccine. Sanofi has a collaboration with the Biomedical Advanced Research and Development Authority to fund the development of its recombinant-based COVID-19 vaccine candidate. Meanwhile, the company has also collaborated with Translate Bio to develop an mRNA-based vaccine for coronavirus infection.
Last month, Regeneron/Sanofi announced plans to study Kevzara to treat patients hospitalized with severe infection due to COVID-19. Regeneron initiated a U.S. based phase II/III study while Sanofi began a based phase II/III study outside the United States in March. While Regeneron is leading the U.S. studies, Sanofi is taking care of the ex-U.S. studies.
Earnings Whispers
Our proven model does not conclusively predict an earnings beat for Sanofi this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that is not the case here.
Earnings ESP: Its Earnings ESP is 0.00% as the Most Accurate Estimate and the Zacks Consensus Estimate are both pegged at 76 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Sanofi has a Zacks Rank #3.
Stocks to Consider
Here are some large drug stocks that have the right combination of elements to beat on earnings this time around:
Glaxo has an Earnings ESP of +3.19% and a Zacks Rank #3. The company is scheduled to release results on Apr 29.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Image: Bigstock
Sanofi (SNY) to Report Q1 Earnings: What's in the Cards?
Sanofi (SNY - Free Report) will report first-quarter 2020 results on Apr 24, before market open. In the last reported quarter, the company delivered a positive earnings surprise of 5.71%.
The French drugmaker’s performance has been pretty impressive, with the company exceeding earnings expectations in each of the trailing four quarters. The company has a four-quarter positive earnings surprise of 9.27%, on average.
Sanofi Price and EPS Surprise
Sanofi price-eps-surprise | Sanofi Quote
Sanofi stock has declined 3.2% this year so far compared with a decrease of 1.2% for the industry.
Factors to Consider
Sanofi’s Specialty Care and Vaccines units are likely to have performed well in first-quarter 2019, in turn, driving top-line growth. Meanwhile, persistent sluggishness in the Consumer Healthcare unit might reflect on the topline.
Sanofi’s Specialty Care segment sales are likely to have been driven by its blockbuster drug, Dupixent.
Sales of Dupixent in the quarter are likely to have been driven by growth in atopic dermatitis indication and rapid uptake in new indications —asthma and chronic rhinosinusitis with nasal polyposis in the United States. Please note that Sanofi markets Dupixent in partnership with Regeneron (REGN - Free Report) .
Sales of Sanofi’s rare disease and oncology drugs are likely to have increased in the first quarter. However, we do not expect the performance of Diabetes unit to have improved in the to-be-reported quarter. Sales of Sanofi’s diabetes drugs in the United States are declining due to pricing pressure and loss of Part D business. Higher rebates and lower prices are likely to have hurt sales of Sanofi/ Regeneron’s PCSK9 inhibitor, Praluent,
Also, generic/biosimilar headwinds might reflect on the Established Rx Products unit’s sales.
In the Consumer Healthcare unit, recall of its over-the-counter acid reflux medicine Zantac, non-core divestments and increased regulatory requirements, which resulted in product suspensions, are expected to have put pressure on the top line.
Overall, first-quarter 2020 results will reflect difficult year-over-year comparisons as sales in China had increased 22% in the first quarter of 2019.
Importantly, investors will also focus on whether Sanofi provides an updated business outlook for 2020 to include the impact of coronavirus on the call. There is a concern about supply chain disruptions, caused by the outbreak, hurting drug/biotech companies’ first-half earnings.
Meanwhile, with half of the world under a lockdown in the latter part of the quarter, a delay is expected in completion of clinical studies, which could further delay drug approvals and their launch. Investors will look for any such updates from Sanofi.
Key Q1 Developments
Sanofi and Glaxo (GSK - Free Report) signed a letter of intent to combine their innovative technologies to develop an adjuvanted COVID-19 vaccine. Sanofi has a collaboration with the Biomedical Advanced Research and Development Authority to fund the development of its recombinant-based COVID-19 vaccine candidate. Meanwhile, the company has also collaborated with Translate Bio to develop an mRNA-based vaccine for coronavirus infection.
Last month, Regeneron/Sanofi announced plans to study Kevzara to treat patients hospitalized with severe infection due to COVID-19. Regeneron initiated a U.S. based phase II/III study while Sanofi began a based phase II/III study outside the United States in March. While Regeneron is leading the U.S. studies, Sanofi is taking care of the ex-U.S. studies.
Earnings Whispers
Our proven model does not conclusively predict an earnings beat for Sanofi this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that is not the case here.
Earnings ESP: Its Earnings ESP is 0.00% as the Most Accurate Estimate and the Zacks Consensus Estimate are both pegged at 76 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Sanofi has a Zacks Rank #3.
Stocks to Consider
Here are some large drug stocks that have the right combination of elements to beat on earnings this time around:
Eli Lilly (LLY - Free Report) has an Earnings ESP of +1.67% and a Zacks Rank #2. The company is scheduled to release results on Apr 23.You can see the complete list of today’s Zacks #1 Rank stocks here.
Glaxo has an Earnings ESP of +3.19% and a Zacks Rank #3. The company is scheduled to release results on Apr 29.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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