Ultragenyx Reports Q3 Loss, Exceeds Revenue Estimates

Ultragenyx (RARE) reported a quarterly loss of $1.40 per share, which was better than the Zacks Consensus Estimate that anticipated a loss of $1.45. This shows an improvement compared to the loss of $2.23 per share recorded a year earlier. It’s important to note that these figures have been adjusted for non-recurring items.

The results for this quarter reflect an earnings surprise of 3.45%. In the previous quarter, the expectation for this biotechnology company was a loss of $1.64 per share, yet it posted a smaller loss of $1.52, resulting in a notable surprise of 7.32%.

In the past four quarters, Ultragenyx has successfully surpassed consensus EPS estimates in three instances.

Operating within the Zacks Medical - Biomedical and Genetics industry, Ultragenyx generated revenues of $139.49 million for the quarter ending in September 2024. This figure exceeded the Zacks Consensus Estimate by 4.04% and marks a significant increase from the $98.05 million reported in the same quarter last year. The company has consistently surpassed consensus revenue estimates three times in the last four quarters.

The future trajectory of the stock is likely to depend heavily on the comments made by management during the earnings call, which will provide insight into the sustainability of the stock's immediate price movement and future earnings expectations.

Since the start of the year, Ultragenyx shares have seen an increase of approximately 6.8%, while the S&P 500 has gained 19.8% over the same period.

What’s Next for Ultragenyx?

Despite underperforming the market overall this year, investors are left wondering about the potential future of Ultragenyx stock. There are no straightforward answers, but one key approach to gauge future performance lies in examining the company's earnings outlook, which encompasses current consensus earnings expectations for upcoming quarters and trends in estimates.

Research indicates a strong correlation between stock movements and revisions in earnings estimates. Investors may either track these revisions independently or utilize effective rating tools like the Zacks Rank, known for leveraging the power of earnings estimate revisions.

Leading up to this earnings release, the trend in estimate revisions for Ultragenyx has been mixed. Although the direction and extent of revisions may evolve following the recent earnings announcement, the current standing yields a Zacks Rank #3 (Hold) for the stock, implying it is expected to align with market performance in the near term.

It will be informative to observe how estimates for the next quarters and the current fiscal year are adjusted in the coming days. Presently, the consensus EPS estimate for the next quarter is -$1.25, with projected revenues of $147.36 million, and for the current fiscal year, it stands at -$6.29 on revenues of $537.3 million.

Investors should also consider that the broader industry outlook can significantly affect the stock's performance as well. According to the Zacks Industry Rank, the Medical - Biomedical and Genetics sector currently places in the top 38% among over 250 industries categorized by Zacks. Historical data shows that industries ranked in the top 50% tend to outperform those in the bottom 50% by over two to one.

Another player in the same industry, Affimed N.V. (AFMD), has not yet disclosed results for the quarter ending in September 2024. Analysts predict that it will report a quarterly loss of $1.14 per share, indicating a year-over-year increase of 32.9%. Notably, the consensus EPS estimate for this quarter has remained stable over the previous 30 days. Affimed N.V.'s expected revenue of $1.41 million would mark a 34.4% decline from last year’s quarter.

Ultragenyx, Earnings, Loss