Earnings preview: What to expect when Allergan reports Q1 2019 earnings results

Allergan plc (NYSE: AGN) is scheduled to report earnings results for the first quarter of 2019 on Tuesday, May 7, before market open. Revenue is expected to decline 3.9% year-over-year to $3.53 billion while EPS is expected to fall 5.1% to $3.55.

The company has consistently topped earnings estimates over the past four quarters and can be expected to do the same for the first quarter as well.

In the first quarter, Allergan’s revenues are likely to be fueled by its key products such as Botox, Juvederm, Vraylar, Linzess and Lo Loestrin. Allergan has new product launches coming this year, including Cariprazine, which provide opportunities for further growth.

A number of competitors have launched new products over the past year and how these products have impacted the demand for Allergan’s products is a point to look for during the results announcement. Updates on the company’s recent progress with regards to its pipeline is also an area to watch.

In March, Allergan acquired a privately held company called Envy Medical Inc. The acquisition is expected to boost Allergan’s Medical Aesthetics portfolio through the addition of Envy’s skin resurfacing treatment Dermalinfusion. Updates on this deal can be expected.

Meanwhile, Allergan’s revenue could face negative impacts from a couple of factors such as loss of exclusivity, generic competition and pricing pressures. Revenue might also take a hit from the Ozurdex breast implant recalls.

In the fourth quarter of 2018, Allergan’s revenue and earnings surpassed expectations despite seeing year-over-year declines. Total revenues declined 5.7% to $4.08 billion while adjusted EPS dropped 11.7% to $4.29.

Allergan’s shares have gained 10% so far this year.

On Thursday, Allergan’s rival Teva Pharmaceutical (NYSE: TEVA) reported its first quarter 2019 earnings, in which earnings topped estimates while revenues fell short.

 

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