Keryx Biopharmaceuticals (KERX) Up 5% Since Earnings Report: Can It Continue?

A month has gone by since the last earnings report for Keryx Biopharmaceuticals, Inc. KERX. Shares have added about 5% in that time frame, outperforming the market.

Will the recent positive trend continue leading up to the stock's next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted 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.

Keryx Q1 Loss Wider than Expected, Revenues Beat

Keryx reported first-quarter 2017 loss of $0.21 per share, narrower than the year-ago loss of $0.39. However, the loss was wider than the Zacks Consensus Estimate of a loss of $0.18 per share.

However, revenues came in at $11.82 million in the quarter, exceeding the Zacks Consensus Estimate of $10.14 million. Further, it improved almost 109% from the prior-year figure of $5.8 million.

Quarter in Details

Net sales of Auryxia in the U.S. were $10.5 million, up 87.5%, following strong prescription growth. A total of 15,800 prescriptions were written in this quarter, up 72% year over year. Also, Auryxia was added to Medicare Part D drug list of two of the largest Medicare Part D insurance providers, which will give the drug unrestricted access to approximately 95% of phosphate binder patients.

Currently, Keryx is working on expanding Auryxia's label to include the treatment of iron-deficiency anemia (IDA) in adults with stage III–V NDD CKD. In Mar 2017, the FDA accepted the company’s supplemental New Drug Application (sNDA) for Auryxia for review and gave a Prescription Drug User Fee Act (PDUFA) target action date of Nov 6, 2017.

License revenues came in at $1.3 million, up 8.33% year over year. Keryx earns license revenues from royalties on net sales of Riona (Japan trade name for Auryxia) from its Japanese partners.

Research and development expenses declined 10.5% year over year to $6.8 million, primarily due to a decrease in development work at the company’s contract manufacturers following the approval of a second drug product contract manufacturer. Further, it was affected by a decline in clinical costs following the completion of phase III clinical trial of Auryxia in early 2016.

Selling, general and administrative expenses were $23.1 million, up 11% due to expansion of sales force to support commercialization of Auryxia and costs related to potential launch of Auryxia in IDA.

2017 Guidance

Auryxia sales are expected in the range of $56 to $60 million for the full year. The outlook will not include any sales of Auryxia if it gets approved for the IDA indication.

How Have Estimates Been Moving Since Then?

Analysts were quiet during the last one month period as none of them issued any earnings estimate revisions.

Keryx Biopharmaceuticals, Inc. Price and Consensus

Keryx Biopharmaceuticals, Inc. Price and Consensus | Keryx Biopharmaceuticals, Inc. Quote

VGM Scores

At this time, Keryx Biopharmaceuticals' stock has an average Growth Score of 'C', though it is lagging a bit on the momentum front with a 'D'. The stock was allocated also a grade of 'F' on the value side, putting it in the lowest quintile for this investment strategy.

Overall, the stock 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.

The company's stock is suitable solely for growth investors based on our style scores.

Outlook

The Zacks Consensus Estimate for the current quarter moved up over the last 30 days.Notably, the stock has a Zacks Rank #3 (Hold). We expect in-line returns from the stock in the next few months.

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