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Earnings Preview: Q2 results may set the tone for Avid Bioservices’ recovery

Avid Bioservices (CDMO), a contract manufacturer in the biotechnology industry, is scheduled to release its second-quarter financial results Monday after the closing bell. Analysts expect the company to report a loss of $0.09 per share, which marks an improvement from the $0.27 per-share loss recorded in the same period a year earlier.

Revenues of the company, which changed its name from Peregrine Pharma to Avid Bioservices in the beginning of the year, are expected to fall about 16% to $10.75 million in the second quarter. Meanwhile, analysts believe the topline performance will recover from the current slump and bounce back, in the long run, helped by the new master services agreements.

Analysts expected the company to report a loss of $0.09 per share, marking an improvement from last year’s $0.27 per-share loss

While announcing the first-quarter results, the management had reaffirmed its full-year 2019 revenue guidance in the range of $51 million to $55 million, encouraged by the progress in implementing the growth initiatives which have taken the company closer to its goal of improving margins, capacity utilization and cash flow.

Avid Bioservices remained in a net loss in the first quarter when revenues nearly halved to $12.6 million, hurt mainly by a major shipping delay. Net loss widened to $3.4 million or $0.06 per share in the first quarter from $2.6 million or $0.06 per share a year earlier.

Meanwhile, the Tustin, California-based company has received mixed ratings from analysts in the recent weeks, with the majority recommending buy with a consensus price target of $8.33.

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Healthcare contract manufacturing companies, in general, can bet on the increasing demand for medical devices and pharmaceutical products, including generic drugs, to drive growth in the coming years.

Avid shares gained about 23% since the beginning of the year and remained in the positive territory during the early trading hours Friday. Though the stock often outperformed the S&P 500 in recent months, it is struggling to recover from the multi-year lows.

 

Browse through our earnings calendar and get all scheduled earnings announcements, analyst/investor conference, and much more!

Companies reporting earnings this week: Dec 10 – 14

A slew of major companies are reporting earnings this week. Specialty apparel retailer Ascena Retail Group (ASNA) will announce its earnings for the first quarter of fiscal 2019 on Monday after the bell. Analysts predict earnings of $0.04 per share on revenue of $1.56 billion. The company will be benefited from the strong demand growth across the board, especially for the LOFT brand.

Avid Bioservices (CDMO) will report second-quarter results on Monday. Analysts expect a loss of $0.08 per share on revenue of $10.87 million. The dedicated contract development and manufacturing organization have high visibility on customer orders as the anticipated expansion of multiple projects are underway with existing clients and additional revenue from numerous issued new client proposals.

Entertainment and dining venues operator Dave & Buster’s Entertainment (PLAY) is set to post third-quarter results on Tuesday after the bell. Analysts expect earnings to fall by 17.20% to $0.24 per share as costs and expenses are weighing on the bottom line. However, revenue is anticipated to rise by 11.10% to $277.66 million helped by higher comparable sales as well as an increase in customers count.

Specialty apparel retailer American Eagle Outfitters (AEO) will post Q3 results on Tuesday. Analysts project earnings to jump by 29.70% to $0.48 per share and revenue to rise by 6.10% to $1.02 billion. The company is well-positioned to overcome the headwinds facing the specialty retail sector backed by the strength of its popular apparel brands and stable comparable store sales. The positive momentum in digital sales will continue in the third quarter and beyond.

Photronics (PLAB) will announce Q4 earnings on Wednesday before the bell. Earnings are expected to soar 112.50% to $0.17 per share and revenue is likely to increase by 13.40% to $137.2 million. The demand is likely to remain strong across all of its end markets. The photomasks maker is expected to be benefited from the repositioning of the business to take advantage of growing markets in China and demand from captives.

Specialty apparel retailer Tailored Brands (TLRD) is set to post third-quarter results on Wednesday after the bell. Analysts project earnings to jump 25.30% to $0.94 per share driven by proper management of costs and expenses. Revenue is predicted to rise by 1.10% to $819.5 million helped by the strong comparable sales growth from all of its retail brands.

Ciena Corporation (CIEN) will report Q4 earnings on Thursday before the bell. Analysts see a profit of $0.48 per share on revenue of $861.48 million. The quarterly performance is likely to be driven by the continued execution of its strategy and strong broad-based customer demand. The high-speed networking technology developer’s top line growth is likely to be carried towards the bottom line but expenses could narrow the growth percentage.

Drugstore retailer Fred’s Inc. (FRED) could post Q3 results on Thursday. The top and bottom lines are likely to be hurt by a reduction in circular marketing and a decline in comparable store sales. The margins could fall due to prescription rebates in 2017 that did not recur in 2018, increases in remuneration fees and a shift in sales mix.

Membership warehouses operator Costco Wholesale Corporation (COST) will report Q1 earnings on Thursday after the bell. Analysts see a profit of $1.62 per share on revenue of $34.72 billion. The company will be benefited from the higher sales both in stores and online for the double-digit bottom line growth.

As Adobe Systems (ADBE) announces Q4 results on Thursday, analysts expect earnings of $1.89 per share on revenue of $2.43 billion. The diversified software company’s fast-paced subscription growth, specifically Digital Media, could be the driving factor behind the top line growth. Segment-wise, the strong performance in Adobe Document Cloud and Creative Cloud could drive the top line numbers.

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