Can Amgen Earnings Keep Up With Biogen?

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Amgen Inc. (NASDAQ: AMGN) is set to report its most recent quarterly results after the closing bell on Tuesday. The consensus forecast calls for $3.53 in earnings per share (EPS) and $5.63 billion in revenue. The same period of last year reportedly had $3.69 in EPS and $5.9 billion in revenue.

Last week, Biogen posted incredible earnings, along with results from a late-stage Alzheimer’s disease trial, that skyrocketed shares. While most companies the size of Biogen would think a move of 10% would be substantial, shares of Biogen rose a whopping 26% on this news, leaving practically all of its competitors in the dust. Now it’s time to see if Amgen can even get close to matching Biogen’s example.

Earlier this quarter, Amgen released additional data from its early-stage lung cancer study. Specifically, this data came from the ongoing Phase 1 study evaluating AMG 510 in patients with previously treated KRAS G12C-mutated solid tumors.

The initial data from the Phase 1 study were presented at the Annual Meeting of the American Society of Clinical Oncology (ASCO) earlier this year. Overall, the additional follow-up in a larger group of patients with non-small cell lung cancer in this study continued to show anti-tumor activity with no dose-limiting toxicities.

In August, Amgen and Celgene announced a deal in regards to Celgene’s merger with Bristol-Myers Squibb. Essentially, Amgen is buying worldwide rights to Otezla, Celgene’s treatment for psoriasis and psoriatic arthritis, for a total of $13.4 billion in cash.

Sales of Otezla in 2018 were $1.6 billion, driven by strong volume growth. Amgen stated previously that it will focus on medicines that can deliver sustained, long-term volume-driven growth, and the company believes there is a significant opportunity to grow Otezla through global expansion and new indications, with expectations for Otezla to realize at least low double-digit sales growth, on average, over the next five years.

Excluding Tuesday’s move, Amgen had underperformed the broad markets, with the stock is up only 5% year to date. In the past 52 weeks, the stock was up closer to 9%.

Ahead of the report, a few analysts weighed in on Amgen:

  • Merrill Lynch has a Neutral rating and a $215 price target.
  • Sanford Bernstein has an Outperform rating.
  • JPMorgan has a Hold rating.
  • BMO’s Buy rating comes with a $240 target price.
  • Goldman Sachs has a Buy rating and a $243 price target.
  • Cantor Fitzgerald rates it as Hold with a $230 price target.
  • Leerink Swann has a Hold rating and a $189 price target.
  • Cowen has a Buy rating with a $231 target price.
  • Oppenheimer’s Buy rating comes with a $240 target.

Shares of Amgen traded up about 1% on Tuesday, at $207.21 in a 52-week range of $166.30 to $211.90. The consensus price target is $215.62.


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