DJ Regeneron Earnings Crushed Expectations and the Stock Is Rising -- Barrons.com
Regeneron Pharmaceuticals stock rose Friday after the company reported fourth-quarter earnings that smashed Wall Street expectations,.
The company reported non-GAAP diluted earnings of $9.53 per share for the quarter, beating the FactSet consensus estimate of $8.38 per share.
Revenues for the fourth quarter were $2.4 billion, in line with Street expectations. Sales of Dupixent, the blockbuster eczema drug that Regeneron markets in collaboration with Sanofi (ticker: SNY), were $1.2 billion in the quarter, just above FactSet consensus estimates of $1.1 billion. Sales of its macular degeneration drug Eylea were $1.3 billion, meeting the FactSet consensus estimate.
Regeneron stock (REGN) rose 2.8% in premarket trading, and was up 1% shortly after the market open. The stock is up 3.3% so far this year, and 28% over the past 12 months. In mid-January, the company announced a deal worth up to $2.6 billion in 2021 to sell its Covid-19 antibody therapy to the U.S. government. Regeneron has also shared positive data from a trial that tests the antibody as a prophylaxis.
The company said sales of the antibody therapy were $146 million in the fourth quarter of 2020, and $186 million in all of 2020.
In a note out early Friday, Citi Research analyst Mohit Bansal wrote that the earnings beat was likely due to a lower effective tax rate, among other things.
Bansal also praised a $1.5 billion stock buyback program authorized by the company's board in January, but which appears to have been announced for the first time Friday morning.
"It signals that the management believes in the strength of the business, " Bansal wrote. "We agree and think Dupixent growth prospects are still being underappreciated by the street and we think [the] oncology pipeline with Libtayo could provide the much-needed third pillar for growth."
Regeneron shares trade at 12.6 times earnings expected over the next 12 months, well below its five-year average of 20.6 times earnings. Of the 27 analysts who cover Regeneron tracked by FactSet, 18 rate it a Buy or Overweight, while nine rate it a Hold.
In a statement in the company's earnings release, Regeneron CEO Dr. Leonard Schleifer praised his employees' work in 2020 on the Covid-19 antibody therapy, known as REGEN-COV.
"In 2020, the Regeneron team rapidly mobilized our significant scientific, development, manufacturing, and operational capabilities to bring our monoclonal antibody cocktail, REGEN-COV, to patients with Covid-19 through an Emergency Use Authorization," he said. "In 2021, in addition to our ongoing work on Covid-19, we expect further diversified growth driven by continued EYLEA momentum, expanded approvals and increased market penetration for Dupixent, and new launches for Libtayo in oncology."
Write to Josh Nathan-Kazis at firstname.lastname@example.org
(END) Dow Jones Newswires
February 05, 2021 10:04 ET (15:04 GMT)
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