Is a Beat in the Cards for Clovis' (CLVS) Earnings in Q4?

Zacks Equity Research

Clovis Oncology, Inc.’s CLVS fourth-quarter 2019 results are scheduled to be reported on Feb 24, after market close.

Shares of the company have slumped 61.8% in the past year compared with the industry’s decline of 3%.

Clovis’ earnings performance has been mixed so far. The company’s earnings surpassed estimates in two of the trailing four quarters while missing the same twice. The four-quarter miss is 8.61%, on average.

In the last reported quarter, Clovis delivered a positive earnings surprise of 1.56%.

Let’s see how things have shaped up prior to this announcement.

Factors to Impact Q4 Results

Clovis derives revenues entirely from the sale of its sole marketed product, Rubraca, which is approved for treating recurrent ovarian cancer patients. The drug generated sequential growth in the first three quarters of 2019. This is likely to have continued in the fourth quarter as well.

During the fourth quarter, the company gained reimbursement agreements for Rubraca in England and Italy. These agreements improves access to the drug, which may have generated additional sales.

Last month, Clovis announced fourth-quarter preliminary results. The company estimates fourth-quarter Rubraca sales of $38.3-$39.3 million and full-year sales between $142 million and $143 million.

Meanwhile, the company is engaged in expanding Rubraca’s label into additional indications as well as earlier line setting for ovarian cancer. The company has submitted a supplemental new drug application (sNDA) seeking label expansion of the drug to include metastatic castrate-resistant prostate cancer with BRCA-mutation.

With the Rubraca sNDA for prostate cancer getting a priority review from the FDA earlier this month, we expect Clovis to provide an update on its launch plan for this indication during its fourth-quarter earnings call.

Apart from Rubraca, Clovis is also developing lucitanib in combination with Bristol-Myers’ BMY Opdivo for treating cancer in early-stage studies. Ongoing clinical studies and regulatory developments have likely resulted in higher operating expenses for the company.

Why a Likely Positive Surprise

Our proven model predicts an earnings beat for Clovis this time around.  The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate (loss of $1.60) and the Zacks Consensus Estimate (loss of $1.61), stands at +0.81%.

Zacks Rank: Clovis currently has a Zacks Rank #2.

Clovis Oncology, Inc. Price and Consensus

 

Clovis Oncology, Inc. Price and Consensus

Clovis Oncology, Inc. price-consensus-chart | Clovis Oncology, Inc. Quote

Other Stocks That Warrant a Look

Here are some other biotech stocks you may want to consider, as our model shows that these also have the right combination of elements to post an earnings beat in their upcoming releases.

Vericel Corporation VCEL has an Earnings ESP of +11.29% and a Zacks Rank #1. The company is scheduled to release fourth-quarter results on Feb 25. You can see the complete list of today’s Zacks #1 Rank stocks here.

Immunomedics, Inc. IMMU has an Earnings ESP of +3.37% and a Zacks Rank #2.

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Immunomedics, Inc. (IMMU) : Free Stock Analysis Report
 
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