Momenta (MNTA) Down 0.3% Since Last Earnings Report: Can It Rebound?

It has been about a month since the last earnings report for Momenta Pharmaceuticals (MNTA). Shares have lost about 0.3% in that time frame, outperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Momenta 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 drivers.

Momenta’s Q4 Loss Wider Than Expected, Sales Beat

Momenta reported a loss of 85 cents per share in the quarter, much wider than the Zacks Consensus Estimate of a loss of 57 cents and the year-ago quarter’s loss of 10 cents.

Revenues in the quarter came in at $8.1 million, significantly down from the year-ago quarter’s $42.8 million. The figure, however, beat the Zacks Consensus Estimate of $5 million.

Quarter in Detail

Momenta’s top line comprises product revenues of $7.9 million from Sandoz’s sales of Glatopa, a generic version of Teva’s Copaxone (20 mg), which decreased from $10.8 million in the year-ago quarter due to rising competition from Myentry into the Copaxone market.

Research and development revenues came in at $0.3 million compared with the year-ago quarter’s $32 million.

Research and development expenses came in at $38.3 million, flaring up from the $28.7 million incurred in the year-ago quarter, due to a rise in manufacturing and clinical trial costs for nipocalimab and M254.

General and administrative expenses more than doubled to $58.9 million due to a $35-million expense related to a settlement agreement with Nashville General Hospital related to Enoxaparin Sodium Injection.

Pipeline Update

Momenta’s novel auto-immune portfolio includes M230, a Selective Immunomodulator of Fc receptors (SIF3); Nipocalimab (M281), an anti-FcRn monoclonal antibody; and M254, a hypersialylated immunoglobulin designed as a high potency alternative for intravenous immunoglobulin (IVIg).

This January, Momenta announced interim results, featuring early favorable responses to M254. Based on these data, Momenta is expanding Part B to include at least one additional lower dose cohort and augment the number of patients in existing cohorts. Enrollment for the study is ongoing.

The company also plans to launch a phase II study of M254 in chronic inflammatory demyelinating polyneuropathy (CIDP) in the fourth quarter this year.

Target (NYSE:TGT) enrollment has been achieved in Vivacity-MG, the phase II study of nipocalimab in generalized myasthenia gravis (gMG). Momenta expects to report top-line data in the third quarter of 2020.

Unity, the phase II study of nipocalimab in hemolytic disease of the fetus and newborn (HDFN), is enrolling patients. Top-line data is expected in 2021.

Energy Study, the phase II/III clinical study of nipocalimab in warm autoimmune hemolytic anemia (wAIHA) is enrolling patients.

In January 2020, Momenta nominated M267, a SIFbody candidate targeting CD38, for clinical development.

How Have Estimates Been Moving Since Then?

It turns out, estimates review have trended downward during the past month.

VGM Scores

At this time, Momenta has a poor Growth Score of F, however its Momentum Score is doing a lot better with a B. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.

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

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Momenta has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.