Biogen stock could enjoy some upside Thursday if it outperforms Wall Street’s bearish expectations for steep declines in first-quarter sales and earnings.
Analysts polled by FactSet expect Biogen (BIIB) earnings to plunge 46% to $4.97 per share, on an adjusted basis. They also call for sales to slide 25% to $2.65 billion. That would add to a three-quarter streak of declining financials as Biogen is expected to hit a trough in the second quarter.
But so far, earnings season has been rosier than expected for medical companies. Dow Jones drug giant Johnson & Johnson (JNJ), Intuitive Surgical (ISRG) and Edwards Lifesciences (EW) all beat first-quarter views. Abbott Laboratories (ABT) delivered a mixed quarter with earnings that missed some estimates.
So, what’s on deck for Biogen stock?
Biogen Stock Faces Two Issues
Investors in Biogen stock will likely zero in on two key issues.
The first is the looming review date for experimental Alzheimer’s treatment aducanumab on June 7. Analysts are largely split on whether Biogen will secure a win for aducanumab. An ad hoc analysis of a Phase 3 test suggested the drug could have an impact on the disease. But another test failed.
So, Biogen stock investors will likely tune in for an update on aducanumab.
RBC Capital Markets analyst Brian Abrahams says there’s a 40% chance aducanumab could gain Food and Drug Administration approval for a limited patient population. With this scenario, he sees it likely the FDA will require a strict label further restricting aducanumab’s use.
He has a sector perform rating and 263 price target on Biogen stock.
Tecfidera Sales Scrutinized
Multiple sclerosis drug Tecfidera is another key point for Biogen stock. The multiple sclerosis drug is Biogen’s biggest moneymaker, and it’s now facing generics. Biogen called 2021 a “financial reset” in its fourth-quarter earnings release.
Investors will look at how much damage generics are wreaking on Tecfidera sales. In 2020, the drug generated $3.84 billion in sales. That was already a decline of 13.3% from 2019. U.S. sales skidded 19% while international sales dipped 3.3%.
On a year-to-date basis, Biogen stock had climbed 9.7% as of midday Wednesday.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
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