rtmark
LearnBonds.com

Biogen Inc (NASDAQ:BIIB) Crashes and the Future Doesn’t Look Bright

biogen inc earnings

Biogen Inc is having a rough session today as the stock plummets in early morning trading. As at 10:02AM EDT, the share price of Biogen has dropped by 16.73% ($64.43) to a $320.61 trading price. The huge haircut recorded in the trading price of Biogen today can be traced to the quality of the firm’s second quarter (Q2 2015) earnings result that was released this morning.

biogen-idec-2 750xx2500-1406-0-178

Dismal Q2 Financials

Biogen   is a biopharma firm with a market capitalization of $75.41B. The firm discovers, develops, manufactures and delivers therapies for neurological, autoimmune and hematologic disorders. The second quarter result that was released today is very important for the firm because its financials disappointed in the first quarter.

Investors were still hanging with the stock despite the dismal first quarter results with the hopes that Biogen will redeem itself in the second quarter. After all, Biogen beat estimates in 3 out of the previous 4 quarters with an average positive surprise of 12.28%. The plummet recorded in the stock shows that Biogen was not able to redeem itself in the second quarter. Highlights of Biogen’s second quarter results are presented below:

Earnings: Biogen reported Q2 earnings of $4.22 per share above the consensus estimate of $4.07 per share to mark a 3.68% earnings beat.

Revenue: The firm reported revenue of $2.59B below the consensus estimate of $2.71B by 4.63%. The revenue marks a 7% year-over-year increase. Revenue was also affected by a $79M currency headwind.

Guidance: Biogen has reduced its guidance going forward. The firm now expects EPS between $15.50 and $15.95 on revenue growth of 6% to 8%. The new guidance is drastically lower than the previous guidance with EPS of $16.60 to $17.00 per share on revenue growth of 14% to 16%.

Drug Sale Below Expectations

The main reason Biogen  was not able to meet expectations is that its drug sales failed to meet expectations. Sales of its flagship oral drug for Multiple Sclerosis (MS) Tecfidera came in at $833M, a good $100M short of the sales expectation of $933M.

One of the reasons Tecfidera did not record great sales is safety concerns arising after one of the patients taking the drug died from a rare brain infection.

Its injectable MS drug, Tysabri brought in $463M below the estimate of $505M. Its interferon-based MS drug, Avonex and Plegridy brought in $690M below the expected sales of $767M.

Takings from the Q2 Results

The reduction in guidance is the main reason the shares of Biogen are taking a drubbing today. An increase in guidance usually suggests that management is optimistic about the future and investors will be content to take the dismal Q2 results as the function of a bad quarter. However, reducing guidance after posting a bad quarter suggests that the firm expects the situation of things to worsen going forward.

 

Trusted & Regulated Stock & CFD Brokers

Rating

What we like

  • 0% Fees on Stocks
  • 5000+ Stocks, ETFs and other Markets
  • Accepts Paypal Deposits

Min Deposit

$200

Charge per Trade

Zero Commission on real stocks

Rating

64 traders signed up today

Visit Now

67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Available Assets

  • Total Number of Stocks & Shares5000+
  • US Stocks
  • German Stocks
  • UK Stocks
  • European
  • ETF Stocks
  • IPO
  • Funds
  • Bonds
  • Options
  • Futures
  • CFDs
  • Crypto

Charge per Trade

  • FTSE 100 Zero Commission
  • NASDAQ Zero Commission
  • DAX Zero Commission
  • Facebook Zero Commission
  • Alphabet Zero Commission
  • Tesla Zero Commission
  • Apple Zero Commission
  • Microsoft Zero Commission

Deposit Method

  • Wire Transfer
  • Credit Cards
  • Bank Account
  • Paypall
  • Skrill
  • Neteller

What we like

  • 0% Commission
  • Trade Stocks Via CFDs
  • Authorized & regulated by the FCA

Min Deposit

$100

Charge per Trade

Zero Commission

Rating

Visit Now

76.4% of retail investor accounts lose money when trading CFDs with this provider.

Available Assets

  • Total Number of Stocks & Shares+2000
  • US Stocks
  • German Stocks
  • UK Stocks
  • European
  • ETF Stocks
  • IPO
  • Funds
  • Bonds
  • Options
  • Future
  • CFDs
  • Crypto

Charge per Trade

  • FTSE 100 Zero Commission
  • NASDAQ Zero Commission
  • Dax Zero Commission
  • Facebook Zero Commission
  • Alphabet Zero Commission
  • Tesla Zero Commission
  • Apple Zero Commission
  • Microsoft Zero Commission

Deposit Method

  • Wire transfer
  • Credit Cards
  • Bank Account
  • Paypal
  • Skrill
Users should remember that all trading carries risks and users should only invest in regulated firms. Views expressed are those of the writers only. Past performance is no guarantee of future results. The opinions expressed in this Site do not constitute investment advice and independent financial advice should be sought where appropriate. This website is free for you to use but we may receive commission from the companies we feature on this site.
vicsterinc@gmail.com'

Victor Alagbe is a seasoned business and finance writer with a specialty in writing about how to invest for the long-term in healthcare, pharmacology, energy and tech stocks. His long-term focus is on stocks that provide a nice mix of growth and income. For the short term, he passionately writes about trading stock options for the excitement and leverage that stock options offer.