BioMarin (BMRN) Q1 Earnings: Will It Beat Estimates Again?

We expect BioMarin Pharmaceutical Inc. (NASDAQ:BMRN) to beat expectations when it reports first-quarter 2017 results on May 4, after the market closes. BioMarin had delivered a positive earnings surprise of 5.13% in the last quarter.

BioMarin’s shares are up 16% so far this year. This compares favorably with the 4.7% increase registered by the Zacks classified Biomed/Genetics industry during this period.

BioMarin’s track record has been strong, with the company beating estimates in each of the past four quarters, recording an average positive surprise of 52.16%.

Let’s see how things are shaping up for the company this quarter

Factors at Play

Key orphan disease drugs, Vimizim and Kuvan, which drove BioMarin’s top line in the past few quarters, should continue the strong momentum this quarter too. Robust patient growth and penetration should propel the drugs’ sales.

Naglazyme revenues vary on a quarterly basis primarily due infrequent ordering patterns from some countries in Latin America and the Middle East.

Nevertheless, the drug continued to witness steady patient growth in 2016 and we expect the trend to continue this year.

We expect management to discuss how the pipeline is progressing at the conference call. Brineura, for the treatment of children with CLN2 disease, a form of Batten disease, is expected to be approved this year. Several data readouts are also lined up in the coming quarters.

What Our Model Indicates

Our proven model shows that BioMarinis likely to beat estimates because it has the right combination of two key ingredients. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for a likely positive surprise and BioMarinhas the right mix.

Zacks ESP: Earnings ESP, which represents the difference between the Most Accurate estimate (loss of 24 cents per share) and the Zacks Consensus Estimate (loss of 30 cents per share), is +20.0%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: BioMarin has a Zacks Rank #3. The combination of BioMarin’s Zacks Rank #3 and positive ESP makes us confident of an earnings beat in the upcoming release.

Sell-rated stocks (Zacks Rank #4 or 5), on the other hand, should never be considered going into an earnings announcement, especially when the company is seeing negative estimate revisions.

Other Stocks to Consider

Stocks in the pharma sector that have both a positive ESP and a favorable Zacks Rank are:

Proteostasis Therapeutics, Inc. (NASDAQ:PTI) , which is expected to release results on May 12, has an Earnings ESP of +5.17% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Ultragenyx Pharmaceutical Inc. (NASDAQ:RARE) with an Earnings ESP of +0.59% and a Zacks Rank #3. The company is expected to release results on May 8.

Scheduled to release results on May 2, Gilead Sciences, Inc. (NASDAQ:GILD) has an Earnings ESP of +2.77% and a Zacks Rank #3.

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