Aduro (ADRO) Q4 Loss Narrower Than Expected, Revenues Miss

Aduro Biotech, Inc. (NASDAQ:ADRO) reported fourth-quarter 2017 loss of 34 cents per share, narrower than both the Zacks Consensus Estimate of a loss of 36 cents and the year-ago loss of 44 cents.

Quarterly revenues fell 3.1% year over year to $3.8 million, mainly due to a decrease in grant revenues. The top line also missed the Zacks Consensus Estimate of $4 million.

Aduro’s shares have underperformed the industry in a year’s time. The stock has declined 41.4%, comparing unfavorably with the industry’s decrease of 5.3%.

Research and development expenses rose 9.6% in the reported quarter to $22.9 million, mainly due to an increase in costs related to manufacturing of B-select antibodies and higher facility related costs. However, this downside was partially offset by decreased manufacturing costs regarding discontinuation of the company’s pancreatic cancer program.

General and administrative expenses were $8.8 million, up 10% year over year on higher stock-based compensation expense and consulting and professional fees.

2017 Results

While full-year sales tumbled 66.1% year over year to $17.1 million, full-year loss of $1.26 per share was narrower than the year-ago figure of $1.40.

Pipeline Update

Aduro has a broad pipeline of novel immunotherapies being developed for treating a variety of cancers.

The company evaluates its STING pathway activator, ADU-S100, in combination with Novartis AG’s (NYSE:NVS) PD-1 checkpoint inhibitor, PDR001, in a phase Ib trial for treating solid tumors and lymphomas. Additionally, the candidate is being evaluated in a phase I study as a monotherapy on patients with cutaneous accessible metastatic solid tumors or lymphomas. Top-line data from the program is expected soon.

Meanwhile, in December 2017, Aduro announced that it has initiated a phase I/II2 dose escalation study, examining its pipeline candidate, BION-1301, for treatment of adults with relapsed or refractory multiple myeloma.

Aduro Biotech, Inc. Price, Consensus and EPS Surprise

Aduro Biotech, Inc. Price, Consensus and EPS Surprise | Aduro Biotech, Inc. Quote

Zacks Rank

Aduro carries a Zacks Rank #3 (Hold). Two better-ranked stocks in the health care sector are Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) and Ligand Pharmaceuticals Incorporated (NASDAQ:LGND) . While Regeneron sports a Zacks Rank #1 (Strong Buy), Ligand carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Regeneron’s earnings per share estimates have moved up from $17.13 to $18.65 and from $20.37 to $21.56 for 2018 and 2019, respectively, in the last 30 days. The company pulled off a positive earnings surprise in three of the last four quarters with an average beat of 9.15%.

Ligand’s earnings per share estimates have been revised upward from $3.78 to $4.15 for 2018 in the last 30 days. The company delivered a positive surprise in three of the trailing four quarters with an average beat of 24.88%. Share price of the company has surged 50.4% over a year.

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