On Tuesday, Seattle Genetics, Inc. SGEN released its most recent earnings report, followed by the company's earnings call.
Revenues came in up 25.8 percent at $93.5 million, R&D expense up 16.6 percent at $74.6 million and SG&A up 14.3 percent at $33.6 million. However, operating loss came in up 9.4 percent at $25.1 million, the net loss was up 6.7 percent at $24.9 million and the loss/share was up 18.2 percent at $0.18.
During the conference call, Chairman, President and CEO Clay B. Siegall emphasized the company's success: "2015 was a year of significant progress and strong execution for Seattle Genetics."
Since the conference call, Seattle Genetics has fallen 8.26 percent to $26.64 Wednesday morning.
On Wednesday, Cantor Fitzgerald released a company update on Seattle Genetics, upgrading the stock to Buy with a $38 price target.
According to the firm, "We are upgrading shares of Seattle Genetics on the premise that the below-consensus guidance for ADCETRIS [a ‘monoclonal antibody drug conjugate treatment for CD30+ cancers'] is likely too conservative, and with moderate expectations and the current valuation, the shares could have an opportunity to move off of what looks like the bottom end of a trading range."
The firm reiterated that the guidance given by Seattle Genetics was, in the analysts' view, conservative and therefore provides "wiggle room."
"Further," Cantor Fitzgerald explained, "with a solid cash position ($700+ million) and limited clinical risk, we think it is well-positioned in a volatile market. We are therefore upgrading to a Buy from a Hold while lowering our PT to $38 from $44 to reflect decreased multiples being ascribed to biotechnology companies in the current market."
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