Will Regeneron’s Revenue Surpass Analysts’ Estimates in 1Q17?



Guidance for 2017

In 2017, Regeneron (REGN) expects its eye drug, Eylea, to witness single-digit revenue growth on a year-over-year (or YoY) basis. Eylea has continued to be the company’s major revenue driver in the year. To know more about Regeneron’s projected revenue growth for 2017, read Regeneron Expected to Witness Robust Growth in Revenues in 2017.

Regeneron is also expecting reimbursement from Sanofi (SNY) for commercialization-related expenses in the range of $400 million–$450 million.

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For 2017, the company has projected its non-GAAP (generally accepted accounting principles) unreimbursed research and development (or R&D) expenses to fall in the range of $950 million–$1.0 billion. It expects its non-GAAP selling, general, and administrative expenses to be between $1.2 billion and $1.3 billion. Regeneron also expects its 2017 capital expenditure to fall in the range of $375 million–$450 million.

Analysts’ estimates

Wall Street analysts expect Regeneron’s 1Q17 revenue to be ~$1.3 billion, a YoY rise of ~8.3%.

If Regeneron manages to surpass its 1Q17 revenue projections, it could see a favorable impact on its share price and the share price of the iShares NASDAQ Biotechnology ETF (IBB). Regeneron makes up ~6.4% of IBB’s total portfolio holdings.

In 1Q17, Regeneron’s peers Exelixis (EXEL) and Vertex Pharmaceuticals (VRTX) are expected to earn revenues of close to $65.2 million and $511.0 million, respectively.

Major revenue driver

In 2016, Eylea managed to report 24% YoY revenue growth in US markets. However, Regeneron anticipates a slowdown in the growth of its anti-VEGF (anti vascular endothelial growth factor) agent, as it considers this to be a normal lifecycle transition for a mature product that doesn’t opt for price rises.

In the next article, we’ll discuss analysts’ recommendations for Regeneron in April 2017.


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