Amgen Earnings Point to More Froth in the Biotech Sector

Health and Healthcare

Published: April 21, 2015 4:29 pm

Last Updated: April 27, 2020 3:52 pm

Amgen Corp. (NASDAQ: AMGN) reported first-quarter 2015 earnings Tuesday afternoon after equity markets had closed. The biotech firm posted adjusted earnings per share (EPS) of $2.48 on revenues of $5.03 billion. In the first quarter of 2014, the company reported EPS of $1.87 on revenues of $4.52 billion. Consensus estimates from Thomson Reuters called for EPS of $2.10 on revenues of $4.91 billion.

Product sales rose 12% compared with the first quarter of 2014, primarily on the sale of the company’s Enbrel, Prolia, Epogen, Sensipar and Xgeva products. Growth was the result of price and higher demand.

R&D expenses dropped by 14% and total operating expenses fell by 3% to $2.58 billion. Amgen’s operating margin rose to 50.2% from 42.7% in the same period a year ago.

In its guidance statement, Amgen raised the low end of its revenue estimate by $100 million to a new range of $20.9 million to $21.3 billion for the full fiscal year. The top end of the range was unchanged. The adjusted EPS range rose from $9.05 to $9.40 to a new range of $9.35 to $9.65.

Analysts had consensus second-quarter estimates of $2.36 for EPS and $5.29 billion for revenues. Full-year estimates called for EPS of $9.32 and revenues of $20.98.

The company’s CEO said:

With solid execution in the first quarter, Amgen achieved strong sales and earnings growth and demonstrated substantial progress in achieving our long-term objectives. Our continuing success in delivering results gives us the confidence to increase our full year outlook for earnings.

ALSO READ: 4 Biotech and Pharma Stocks Projected to Rise 50% to 100%

Amgen beat the consensus EPS estimate by 18%. That showing is likely to drive the biotech stocks to even greater heights. While Amgen cannot pump the entire sector all by itself, it is a bellwether for the biotechs and we can expect some new tops going forward.

Shares traded higher by more than 2% in the after-hours session Tuesday, at $172.00 in a 52-week range of $108.20 to $173.14. Thomson Reuters had a consensus price target on the stock of $176.84 before the results were announced.

It’s Your Money, Your Future—Own It (sponsor)

Retirement can be daunting, but it doesn’t need to be.

Imagine having an expert in your corner to help you with your financial goals. Someone to help you determine if you’re ahead, behind, or right on track. With SmartAsset, that’s not just a dream—it’s reality. This free tool connects you with pre-screened financial advisors who work in your best interests. It’s quick, it’s easy, so take the leap today and start planning smarter!

Don’t waste another minute; get started right here and help your retirement dreams become a retirement reality.