ViroPharma Earnings Preview

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ViroPharma (NAS: VPHM) didn't meet the Street's expectations last quarter, but investors hope that it will rebound this quarter. The company will unveil its latest earnings on Monday, Oct. 24. ViroPharma develops and commercializes products that address serious diseases, with a focus on those used by physician specialists or in hospital settings.

What analysts say:

  • Buy, sell, or hold?: Analysts strongly back ViroPharma, with 12 of 15 rating it a buy and the remainder rating it a hold. Analysts still rate the stock a moderate buy, but they are a bit more wary about it compared to three months ago.
  • Revenue forecasts: On average, analysts predict $129.5 million in revenue this quarter. That would represent a rise of 9.9% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.32 per share. Estimates range from $0.21 to $0.41.

What our community says:
CAPS All-Stars are solidly behind the stock with 97.7% assigning it an "outperform" rating. The community at large concurs with the All-Stars with 97.2% awarding it a rating of "outperform." Fools are bullish on ViroPharma and haven't been shy with their opinions lately, logging 464 posts in the past 30 days. Even with a robust four out of five stars, ViroPharma's CAPS rating falls a little short of the community's upbeat outlook.

Management:
ViroPharma's profit has risen year over year by an average of 88.5% over the past five quarters. The company's gross margin shrank by four percentage points in the last quarter. Revenue rose 18.2% while cost of sales rose 56.2% to $21.3 million from a year earlier.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter

Q2

Q1

Q4

Q3

Gross Margin

83.5%

85.1%

85.3%

86.6%

Operating Margin

32.8%

47.3%

50.1%

50.3%

Net Margin

17.7%

28.7%

30.8%

32.6%

One final thing: If you want to keep tabs on ViroPharma movements, and for more analysis on the company, make sure you add it to your Watchlist.

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At the time this article was published

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