Momenta (MNTA) Down 16.6% 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 16.6% in that time frame, underperforming 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 its most recent earnings report in order to get a better handle on the important catalysts.

Momenta Misses on Q1 Earnings, Sales

The company reported loss per share of 46 cents in the quarter (excluding restructuring charges), a penny wider than the Zacks Consensus Estimate of 45 cents but narrower than the year-ago loss of 63 cents.

Revenues in the quarter came in at $4.1 million, which declined from $4.9 million in the year-ago quarter and missed the Zacks Consensus Estimate of $10 million.

Quarter in Detail

Momenta’s top line comprises product revenues of $2.4 million earned from Sandoz’s sales of Glatopa, a generic version of Copaxone (20 mg), compared with $3.5 million in the year-ago quarter due to increasing competition from Mylan’s entry into the Copaxone market.

Research and development revenues came in at $1.8 million compared with $1.3 million in the year-ago quarter.

Research and development expenses decreased to $28 million from $33.2 million in the year-ago quarter, due to cost savings following our workforce reduction in the fourth quarter of 2018 and lower lease costs.

General and administrative expenses were $24.2 million, up 17% year over year due to increased legal costs and depreciation.

Pipeline Update

Momenta’s novel auto-immune portfolio includes M230, a Selective Immunomodulator of Fc receptors (SIF3); M281, an anti-FcRn monoclonal antibody; and M254.

Momenta initiated two phase II proof of concept clinical trials on M281, one in generalized myasthenia gravis (gMG) and the other in hemolytic disease of the fetus and newborn (HDFN), with top-line results anticipated in 2020 and 2021, respectively.  Momenta also plans to initiate a third study of M281 in an additional autoimmune indication later in 2019.

In January 2019, Momenta announced that the first subject was dosed in the phase I/II clinical trial of M254 in immune thrombocytopenia  (ITP). The multi-part study will first enroll healthy volunteers, and includes single and multiple dose studies, and a randomized cross-over study comparing M254 to IVIg. Preliminary clinical data is expected in 2020.

The phase I trial on M230 in healthy volunteers to evaluate the safety and tolerability of the candidate is ongoing. Momenta’s partner, CSL expects to complete the phase I study by the end of 2019.

2019 Guidance

Momenta expects 2019 expenses to be $45-$55 million.

How Have Estimates Been Moving Since Then?

Fresh estimates followed an upward path over the past two months.

VGM Scores

Currently, Momenta has a subpar Growth Score of D, however its Momentum Score is doing a bit better with a C. However, the stock was allocated a grade of F on the value side, putting it in the bottom 20% 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

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

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