BioMarin (BMRN) Q4 Earnings: Will it Post a Beat Again?

We expect BioMarin Pharmaceutical Inc. BMRN to beat expectations when it reports fourth-quarter and full-year 2016 results on Feb 23 after the market closes. BioMarin had delivered a positive earnings surprise of 66.67% in the last quarter.

BioMarin’s shares are up 9.2% so far this year. This compares favorably with 7.3% increase registered by the Zacks classified Biomed/Genetics industry during this period.

BioMarin’s track record has been decent so far, with the company beating estimates in three of the last four quarters. However, over the trailing four quarters, the company has recorded an average negative surprise of 2.60%.

 

BioMarin Pharmaceutical Inc. Price and EPS Surprise

BioMarin Pharmaceutical Inc. Price and EPS Surprise | BioMarin Pharmaceutical Inc. Quote

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

Factors at Play

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

Meanwhile, last quarter, the company experienced significant unevenness in orders, particularly in Brazil and the Middle East, where political and economic instability had an impact on results. We expect these factors to hurt international revenues in the fourth quarter as well.

Naglazyme revenues vary on a quarterly basis, primarily due to the timing of central government orders from Latin America. Nevertheless, the drug continued to witness steady patient growth in the past two quarters and should do the same in fourth-quarter 2016.

On the pipeline front, BioMarin initiated a global phase III study for vosoritide in children with achondroplasia, the most common form of dwarfis. We expect the company to update on the trial at the fourth quarter conference call.

What Our Model Indicates

Our proven model shows that BioMarin is likely to beat estimates because it has the right combination of the 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 BioMarin has the right mix.

Zacks ESP: Earnings ESP, which represents the difference between the Most Accurate estimate (loss of 37 cents per share) and the Zacks Consensus Estimate ( loss of 40 cents per share), is +7.50%. 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 favorable Zacks Rank #3 and positive ESP makes us confident of a 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 a negative estimate revisions.

Other Stocks to Consider

Other stocks in the large cap pharmaceuticals sector that have both a positive ESP and a favorable Zacks Rank are:

Exelixis, Inc. EXEL, scheduled to release results on Feb 27, has an Earnings ESP of +200.0% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Exact Sciences Corporation EXAS has an Earnings ESP of +5.00% and a Zacks Rank #2. The company is scheduled to release results on Feb 21.

Galena Biopharma, Inc. GALE has an Earnings ESP of +11.77% and a Zacks Rank #3. The company is scheduled to release results on Mar 9.

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BioMarin Pharmaceutical Inc. (BMRN): Free Stock Analysis Report
 
Exelixis, Inc. (EXEL): Free Stock Analysis Report
 
Exact Sciences Corporation (EXAS): Free Stock Analysis Report
 
Galena Biopharma, Inc. (GALE): Free Stock Analysis Report
 
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