Drug Stocks' Earnings To Watch On Aug 12: CXRX, PTI & ABEO

The Q2 earnings season is almost over with as many as 92.1% S&P 500 members having reported results as of Aug 10. What does the Q2 earnings season scorecard look like so far? Both earnings and revenue growth was negative with the quarter on track to be the fifth in a row to record an earnings decline for the S&P 500 index.

Of the 454 S&P 500 members that have declared quarterly numbers as of Aug 10, an impressive 71.1% were able to top earnings estimates while 52.9% surpassed top-line expectations.

Notably, the Technology and Medical sectors recorded the highest proportion of positive surprises. In fact, results of the Medical sector have been particularly strong so far.

Our Q2 scorecard for the Medical sector shows that 96.2% have reported results with a blended beat of 74% (the percentage of companies that have beaten both earnings and revenue estimates), with the sector registering 5% earnings growth on 9.2% higher revenues.

Note that per our Earnings Trends report, Medical is one of the nine sectors expected to record positive earnings growth (4.7%) this quarter.

While the majority of pharma and biotech companies have already released quarterly results, quite a few companies in the sector are yet to declare the same. Let’s see what’s in store for these three drug stocks.

Can these Drug Stocks Surprise?

Headquartered in Oakville, Canada, Concordia International Corp. (NASDAQ:CXRX) is a pharmaceutical company focused on legacy pharmaceutical products and orphan drugs. The company markets orphan drugs through its Orphan Drug Division, consisting of Photofrin for the treatment of certain rare forms of cancer, which is currently being evaluated for additional indications.

Concordia has missed earnings expectations in each of the past four quarters, with an average negative earnings surprise of 8.56%. Given its track record, will the stock disappoint again? Concordia currently carries a Zacks Rank #3 (Hold). Though the stock’s Zacks Rank #3 increases the predictive power of the ESP, its 0.00% Earnings ESP makes a surprise prediction difficult this quarter. The company is scheduled to release Q2 results on Aug 12.

Abeona Therapeutics Inc. (NASDAQ:ABEO) is a development-stage company focused on the development of gene therapy and plasma-based treatments for severe and life-threatening rare genetic diseases. This Dallas, TX-based company’s performance has been far from encouraging, having missed estimates consistently. Overall, the company has clocked an average negative surprise of 62.43%. Its Zacks Rank #3, when combined with a 0.00% ESP, makes surprise prediction difficult for this quarter.

Abeona is expected to report Q2 results on Aug 12.

Based in Cambridge, MA, Proteostasis Therapeutics, Inc. (NASDAQ:PTI) is a development-stage biopharmaceutical company focused on the discovery and development of novel therapeutics targeting diseases caused by an imbalance in the proteostasis network with an initial therapeutic focus on cystic fibrosis. Proteostasis started trading from Feb 2016. Last quarter, the company posted a negative surprise of 85.11%. Proteostasis’ Zacks Rank #3, when combined with an ESP of 0.00%, makes surprise prediction difficult for this quarter. It is expected to release Q2 results on Aug 12.