As the Q2 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the pharmaceuticals industry, including Jazz Pharmaceuticals (NASDAQ: JAZZ) and its peers.
The pharmaceuticals sector develops, manufactures, and distributes drugs, benefiting from diversified portfolios of branded and generic medications. Looking ahead, growth will be driven by innovations in precision medicine, such as genetic therapies and advanced biologics, and the increasing use of AI to speed and increase the efficiency of drug discovery. These could specifically magnify the advantages of the most scaled players. Conversely, the sector faces considerable headwinds from intense, bipartisan political pressure on drug pricing, scrutiny of patent practices, and growing competition from biosimilars. These could specifically stymie the growth of smaller companies or ones facing patent expirations on key drugs.
The 16 pharmaceuticals stocks we track reported a strong Q2. As a group, revenues beat analysts’ consensus estimates by 2.9% while next quarter’s revenue guidance was 0.5% above.
Luckily, pharmaceuticals stocks have performed well with share prices up 11.9% on average since the latest earnings results.
Jazz Pharmaceuticals (NASDAQ: JAZZ)
Originally founded in 2003 and now headquartered in Ireland following a 2012 tax inversion merger, Jazz Pharmaceuticals (NASDAQGS:JAZZ) develops and markets medicines for sleep disorders, epilepsy, and cancer, with a focus on treatments for patients with limited therapeutic options.
Jazz Pharmaceuticals reported revenues of $1.05 billion, up 2.1% year on year. This print was in line with analysts’ expectations, but overall, it was a slower quarter for the company with full-year EBITDA guidance missing analysts’ expectations.
"It has been a privilege to lead Jazz over my 22-year tenure. I am proud of what we have achieved on behalf of patients and confident that our new President and CEO, Renee Gala, will build on Jazz's momentum and serve as a catalyst in driving long-term growth," said Bruce Cozadd, chairman and chief executive officer, Jazz Pharmaceuticals.
Interestingly, the stock is up 4.3% since reporting and currently trades at $117.90.
Read our full report on Jazz Pharmaceuticals here, it’s free.
Best Q2: Supernus Pharmaceuticals (NASDAQ: SUPN)
With a diverse portfolio of eight FDA-approved medications targeting neurological conditions, Supernus Pharmaceuticals (NASDAQ: SUPN) develops and markets treatments for central nervous system disorders including epilepsy, ADHD, Parkinson's disease, and migraine.
Supernus Pharmaceuticals reported revenues of $165.5 million, down 1.7% year on year, outperforming analysts’ expectations by 7.4%. The business had an incredible quarter with a beat of analysts’ EPS estimates and full-year operating income guidance exceeding analysts’ expectations.
Supernus Pharmaceuticals achieved the highest full-year guidance raise among its peers. The market seems happy with the results as the stock is up 13.7% since reporting. It currently trades at $42.69.
Is now the time to buy Supernus Pharmaceuticals? Access our full analysis of the earnings results here, it’s free.
Corcept (NASDAQ: CORT)
Focusing on the powerful stress hormone that affects everything from metabolism to immune function, Corcept Therapeutics (NASDAQ: CORT) develops and markets medications that modulate cortisol to treat endocrine disorders, cancer, and neurological diseases.
Corcept reported revenues of $194.4 million, up 18.7% year on year, falling short of analysts’ expectations by 3.5%. It was a softer quarter as it posted full-year revenue guidance missing analysts’ expectations.
Corcept delivered the weakest performance against analyst estimates and weakest full-year guidance update in the group. Interestingly, the stock is up 9.2% since the results and currently trades at $73.17.
Read our full analysis of Corcept’s results here.
Bristol-Myers Squibb (NYSE: BMY)
With roots dating back to 1887 and a transformative merger in 1989 that gave the company its current name, Bristol-Myers Squibb (NYSE: BMY) discovers, develops, and markets prescription medications for serious diseases including cancer, blood disorders, immunological conditions, and cardiovascular diseases.
Bristol-Myers Squibb reported revenues of $12.27 billion, flat year on year. This result topped analysts’ expectations by 7.8%. Overall, it was an exceptional quarter as it also produced a beat of analysts’ EPS estimates and an impressive beat of analysts’ full-year EPS guidance estimates.
The stock is up 5.5% since reporting and currently trades at $48.52.
Read our full, actionable report on Bristol-Myers Squibb here, it’s free.
Royalty Pharma (NASDAQ: RPRX)
Pioneering a unique business model in the pharmaceutical industry since 1996, Royalty Pharma (NASDAQ: RPRX) acquires rights to receive portions of sales from successful biopharmaceutical products, providing funding to drug developers without conducting research itself.
Royalty Pharma reported revenues of $578.7 million, up 7.7% year on year. This number lagged analysts' expectations by 1.9%. All in all, it was a slower quarter for the company.
The stock is down 4.7% since reporting and currently trades at $36.11.
Read our full, actionable report on Royalty Pharma here, it’s free.
Market Update
In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.
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