A month has gone by since the last earnings report for Sarepta Therapeutics, Inc. (NASDAQ:SRPT) . Shares have lost about 9.9% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Sarepta Q2 Loss Narrows, Ups Exondys 51 Sales View
Sarepta incurred a loss of $0.65 per share in the second quarter of 2017, narrower than the year-ago loss of $1.35 as well as the Zacks Consensus Estimate of a loss of $0.92.
Loss per share excludes restructuring costs and gain from asset sale but includes the impact of share-based compensation expenses.
Quarterly Details
In the first quarter, Sarepta recorded revenues of $35 million, up 115% sequentially, primarily due to sales of Exondys 51. Revenues beat the Zacks Consensus Estimate. In the prior-year quarter, Sarepta recognized no revenues.
Adjusted research and development (R&D) expenses were $34.6 million in the second quarter, down 16.4% year over year, due to lower manufacturing expenses owing to the capitalization of inventory following the approval of Exondys 51 by the FDA. Adjusted selling, general & administrative (SG&A) expenses were $25.4 million, up 92.1% year over year, due to increased legal fees and commercial initiatives, compensation and other personnel expenses.
Both R&D and SG&A expenses exclude the impact of restructuring costs and share-based compensation expenses.
Sarepta received a one-time payment of $22 million from Summit Therapeutics for completing enrolment in a phase II study evaluating utrophin modulator, ezutromid
Outlook
Based on sales trends witnessed in the second quarter, Sarepta updated its guidance for Exondys 51 sales to $125 million to $130 million in 2017, higher than its prior guidance of $95 million. The Zacks Consensus Estimate for 2017 sales is pegged at $103.51 million.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed an upward trend in fresh estimates. There has been one revision higher for the current quarter.
VGM Scores
At this time, Sarepta's stock has a poor Growth Score of F, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated also a grade of F on the value side, putting it in the fifth quintile for this investment strategy.
Overall, stocks has an aggregte VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate investors will probably be better served looking elsewhere.
Outlook
Estimates have been trending upward for the stock. The magnitude of these revisions also looks promising. Notably, the stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.
Sarepta Therapeutics, Inc. (SRPT): Free Stock Analysis Report
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