Corcept (CORT) Down 24.9% Since Last Earnings Report: Can It Rebound?

It has been about a month since the last earnings report for Corcept Therapeutics (CORT). Shares have lost about 24.9% in that time frame, outperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Corcept due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.

Corcept Q4 Earnings In Line With Estimates, Up Y/Y

Corcept reported fourth-quarter 2019 earnings of 24 cents per share, in line with the Zacks Consensus Estimate. The bottom line improved from the year-ago figure of 18 cents per share.

Taking into account the impact of stock-based compensation and utilization of deferred tax assets, adjusted earnings came in at 33 cents per share compared with 24 cents in the year-ago quarter.

Revenues in the reported quarter rose 32% from the prior-year period to $87.9 million, primarily backed by higher sales and the strong uptake of Corcept’s Cushing’s syndrome drug Korlym. Sales were almost in line with the Zacks Consensus Estimate of $88 million.

Research and development expenses increased 29.4% from the prior-year quarter to $24.3 million. Selling, general and administrative expenses also increased 25.8% from the year-ago quarter to $27.1 million.

2019 Results

The company’s adjusted earnings came in at $1.09 per share compared with 85 cents in 2018.

Its revenues were $306.5 million, reflecting an increase of 22% year over year.

2020 Guidance

Corcept reiterated its 2020 revenue guidance of $355-375 million as announced in January 2020, when it released fourth-quarter 2019 preliminary results.

Pipeline Update

Corcept’s phase II study on its lead candidate relacorilant — which is being evaluated along with nab-paclitaxel to treat metastatic ovarian cancer — is actively enrolling patients at sites in the United States and Europe, and is on track to produce results in first-half 2021.

The company expects to start the phase III study trial of relacorilant plus nab-paclitaxel to treat patients with metastatic pancreatic cancer in second-quarter 2020.

It also expects to start phase Ib study of relacorilant plus the immunotherapeutic agent Merck’s Keytruda (pembrolizumab) to treat patients with metastatic or unresectable adrenocortical cancer in second-quarter 2020.

The company’s phase III study (GRADIENT) of relacorilant to treat patients with Cushing’s syndrome caused by adrenal adenomas is expected to start in first-quarter 2020.

How Have Estimates Been Moving Since Then?

Estimates revision followed a downward path over the past two months.

VGM Scores

At this time, Corcept has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Corcept has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.