A month has gone by since the last earnings report for Acadia Pharmaceuticals (ACAD). Shares have lost about 45% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Acadia due for a breakout? Before we dive into how investors and analysts have reacted as of late, let’s take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
ACADIA Beats on Q4 Earnings, Misses on Revenues
ACADIA reported fourth-quarter 2020 loss of 42 cents per share, narrower than the Zacks Consensus Estimate of a loss of 48 cents. However, the loss was wider than the year-ago quarter’s loss of 34 cents.
Total revenues comprising net sales of the company’s only marketed drug, Nuplazid (pimavanserin), increased 23% year over year to $121 million in the fourth quarter. However, the top line missed the Zacks Consensus Estimate of $123 million.
Quarter in Detail
Research and development (R&D) expenses were $62.1 million in the quarter, up 8% from the year-ago period due to higher expenses related to the acquisition of CerSci Therapeutics in August last year.
Selling, general and administrative (SG&A) expenses rose 31.4% year over year to $120.8 million due to increased advertising and promotional costs, and higher personnel costs.
As of Dec 31, 2020, ACADIA had cash, cash equivalents and investments worth $632 million compared with $644.4 million as of Sep 30, 2020.
2021 Guidance
ACADIA expects total revenues from Nuplazid sales for the Parkinson’s disease psychosis indication to be in the range of $510-$550 million for 2021. The guidance does not include potential revenues from the dementia-related psychosis (“DRP”) indication, for which Nuplazid is currently under review.
The company expects its R&D expenses to be in the range of $300-$320 million, while SG&A expenses are projected in the band of $560-$590 million for full-year 2021.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates. The consensus estimate has shifted -31.4% due to these changes.
VGM Scores
Currently, Acadia has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. Following the exact same course, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren’t focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It’s no surprise Acadia has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
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