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What's in Store for Catalyst (CPRX) Stock in Q1 Earnings?

Zacks Equity Research
Updated

Catalyst Pharmaceuticals, Inc. CPRX is expected to report first-quarter 2017 results on May 11.  Last quarter, the company recorded a positive earnings surprise of 16.67%. Also, it topped expectations in all of the last four quarters with average positive surprise of 14.59%.

Catalyst’s share price has increased 71.4% year to date, compared with the Zacks classified Medical Drugs industry’s gain of 4.9%.

Let’s see how things are shaping up for this announcement.

Factors to Consider

Although Catalyst does not have any revenue-generating product in its portfolio, investor’s focus on pipeline and regulatory updates is expected to retain. Currently, the company has three candidates under development – Firdapse, CPP-115 and CPP-109.

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Its lead pipeline candidate Firdapse is being evaluated for the symptomatic treatment of Lambert-Eaton myasthenic syndrome (LEMS). In fact, Catalyst started enrolling patients in a second phase III study (LMS-003) on Firdapse for LEMS (LMS-003) in Dec 2016. The company reached an agreement with the FDA under a Special Protocol Assessment (SPA) for protocol design, clinical endpoints and statistical analysis in Oct 2016.

Top-line data from the study are anticipated in the second half of 2017. Notably, a positive outcome would allow the company to resubmit the new drug application (NDA) for Firdapse for the treatment of LEMS in the same period.

Additionally, Catalyst is working on developing Firdapse for additional indications. In Feb 2016, the company initiated an investigator-sponsored phase II/III study on Firdapse for the symptomatic treatment of MuSK-antibody positive MG.  In March, it reported top-line data from the phase II/III trial that showed statistically significant results. According to the investigators the data showed a large clinical benefit to patients.

Apart from Firdapse, Catalyst is also exploring the possibility of developing CPP-115 (a GABA aminotransferase inhibitor) for the treatment of epilepsy (initially infantile spasms) and the other selected neurological indications such as complex partial seizures and Tourette’s disorder. Moreover, it is working on a generic version of Sabril (vigabatrin)- CP-109, which is marketed by Lundbeck Inc. for the treatment of infantile spasms and complex partial seizures.

Earnings Whispers

Our proven model does not conclusively show earnings beat for Catalystis this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here, as you will see below.

Zacks ESP: Catalysthas an Earnings ESP of 0.00%. That is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at a loss of 6 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Catalyst carries a Zacks Rank #3, which increases the predictive power of ESP. However, we need to have a positive ESP to be confident about an earnings beat.

Note that we caution against stocks with Zacks Ranks #4 or 5 (Sell rated) going into an earnings announcement, especially when the company is seeing a negative estimate revision.

Catalyst Pharmaceuticals, Inc. Price and EPS Surprise

 

Catalyst Pharmaceuticals, Inc. Price and EPS Surprise | Catalyst Pharmaceuticals, Inc. Quote

Stocks to Consider

Here are some companies to consider as our model shows that they have the right combination of elements to post an earnings beat in the upcoming quarter:

Ultragenyx Pharmaceutical Inc. RARE has an Earnings ESP of +0.59% and a Zacks Rank #3. The company is expected to release results on May 4. You can see the complete list of today’s Zacks #1 Rank stocks here.

Fibrogen Inc. FGEN has an Earnings ESP of +23.81% and a Zacks Rank #3. The company is expected to release results on May 8.

Editas Medicine, Inc. EDIT has an Earnings ESP of +33.33% and a Zacks Rank #3. The company is expected to release results on May 15.

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Ultragenyx Pharmaceutical Inc. (RARE): Free Stock Analysis Report
 
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Catalyst Pharmaceuticals, Inc. (CPRX): Free Stock Analysis Report
 
FibroGen, Inc (FGEN): Free Stock Analysis Report
 
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