What Happened?
Shares of biotech company Regeneron (NASDAQ: REGN) jumped 8.7% in the morning session after it reported third-quarter financial results that surpassed analyst expectations for both revenue and profit.
The company announced revenue of $3.75 billion, beating the consensus estimate of $3.57 billion, while its adjusted earnings per share of $11.83 easily topped Wall Street's forecast of $9.64. The strong profit outperformance seemed to capture investor attention, despite some mixed signals in the report. For instance, total revenue was flat compared to the same quarter last year, and the company's operating margin, a key indicator of profitability, declined from 31.7% to 27.3% year on year. Nevertheless, the significant beat on the bottom line was enough to fuel a positive market reaction.
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What Is The Market Telling Us
Regeneron’s shares are somewhat volatile and have had 11 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 5 months ago when the stock dropped 19% on the news that the company announced mixed results from its Phase 3 trials for itepekimab, an experimental drug for Chronic Obstructive Pulmonary Disease (COPD). While one trial met its primary endpoint, the other missed, raising concerns about the drug's future and delaying its potential market entry. This setback, likely spooked investors and contributed to the significant decline.
Regeneron is down 11.4% since the beginning of the year, and at $633.87 per share, it is trading 31.7% below its 52-week high of $928.61 from October 2024. Investors who bought $1,000 worth of Regeneron’s shares 5 years ago would now be looking at an investment worth $1,118.
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