Drug Stocks To Watch For Earnings On Nov 4; REGN & More

The bulk of the Q3 earnings season is over, with 364 S&P 500 members (as of Nov 2) – accounting for 72.6% of the index’s total market capitalization – having already reported results, according to the latest Earnings Outlook.

While total earnings for these index members were up 1.6% from the year-ago quarter, revenues were also up 1.6% year over year. The beat ratio was 72.3% for earnings and 54.7% for revenues.

Notably, the ongoing reporting cycle is on track to be the first quarter of positive earnings growth after five consecutive quarters of earnings decline for the S&P 500 index. However, though the third-quarter reporting cycle saw numerous positive surprises and stability in current-quarter (Q4 2016) estimates in the beginning, these two attributes have started losing ground this week. Positive surprises, particularly on the revenue side, have become harder to come by and Q4 estimates are moving down.

This change was reflected in the results of pharmaceutical companies as well. Though quite a few of the large-cap pharma companies posted better-than-expected third-quarter results last week, three large pharma companies that have reported so far this week – Allergan (NYSE:AGN_pa) plc’s (NYSE:AGN) , Gilead Sciences Inc. (NASDAQ:GILD) and Pfizer Inc. (NYSE:PFE) – announced softer-than-expected Q3 results. While Allergan and Pfizer missed estimates for both earnings and sales, Gilead managed to beat sales expectations marginally but missed earnings estimates.

Two more companies from the healthcare sector are set to report their third-quarter results on Nov 4. Let's see how things are shaping up for their respective announcements.

Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN)

Regeneron posted a positive surprise of 21.97% last reported. The company’s performance has been mixed so far. In the last four quarters, it surpassed earnings estimates on two occasions and missed the same twice. Overall, the company has recorded an average negative earnings surprise of 2.04%.

REGENERON PHARM Price and EPS Surprise

REGENERON PHARM Price and EPS Surprise | REGENERON PHARM Quote

Regeneron’s key growth driver, Eylea, should continue to perform well in the third quarter of 2016 and contribute meaningfully to the top line. Apart from Eylea, investor focus will remain on the performance of the PCSK9 inhibitor, Praluent. (Read More: Regeneron Q3 Earnings: Will the Stock Surprise?).

The Zacks Consensus Estimate for the quarter is pegged at $2.27 per share. The company has a Zacks Rank #3 (Hold) and an Earnings ESP of 0.00%. Please check our Earnings ESP Filter that enables you find stocks that are expected to come out with earnings surprises.

Lion Biotechnologies, Inc. (NASDAQ:LBIO)

Last quarter, the company delivered a negative earnings surprise of 21.05%. Lion Biotechnologies had a mixed track record over the last four quarters. The company surpassed expectations twice, missed once and delivered in-line results in the other quarter, with the average positive earnings surprise being 9.52%.

LION BIOTECH Price and EPS Surprise

LION BIOTECH Price and EPS Surprise | LION BIOTECH Quote

The Zacks Consensus Estimate for the quarter is pegged at a loss of 18 cents per share. The company has an Earnings ESP of 0.00% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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