Amneal Posts Better-Than-Expected Q4 Results; Upbeat 2021 Revenue Outlook

Shares of Amneal Pharmaceuticals rose in early trading on Monday after the pharmaceutical company forecasted 2021 revenue that beat Street estimates. Amneal’s 4Q results also topped analysts’ expectations on Friday.

Amneal (AMRX) posted adjusted earnings of $0.14 per share, which jumped 75% year-over-year and beat analysts’ expectations of $0.13. 4Q revenues increased 28% and stood at $510 million. Analysts were expecting revenues of $504.4 million. The company said that the revenue growth was primarily attributable to “$82 million from our AvKARE acquisition and $44 million from new product launches including EluRyng and Sucralfate Oral Suspension.”

Adjusted EBITDA increased 33% year-over-year to $107 million in 4Q driven by higher Generic adjusted gross profit.

As for 2021, the company forecasts revenues in the range of $2.1-$2.2 billion, higher than the consensus estimates of $2.06 billion. Furthermore, Amneal anticipates 2021 adjusted earnings in the range of $0.70-$0.85 per share.

The company’s Co-CEO’s Chirag and Chintu Patel said, “We reinvigorated the Generics business in the United States, continued to build our Specialty franchise, enhanced our operational execution, and diversified our distribution channels. As a result of the solid momentum we are seeing, we have introduced 2021 financial guidance, which reflects our expectations for another year of strong top and bottom line growth.” (See Amneal Pharmaceuticals stock analysis on TipRanks)

Following the results, Raymond James analyst Elliot Wilbur maintained a Hold rating on the stock. In a note to investors, the analyst said, “In conjunction with reporting 4Q results, AMRX also announced the approval of its fifth durable transdermal generic product Zafemy (gX to Ortho Evra) with 180 days of exclusivity competing with the only product in the market, Viatris’ Zulane. Given the market for Zulane is about $270M in sales, we estimate Zafemy has peak sales assumption of around $70-$80M that alone could contribute about $50M-$55M in EBITDA level.”

Overall, consensus among analysts is a Moderate Buy based on 2 Buys and 1 Hold. The average analyst price target of $6.75 implies upside potential of about 25% to current levels. Shares have gained around 36% over the past year.

Amneal Pharmaceuticals scores an 8 out of 10 on TipRanks’ Smart Score ranking suggesting that the stock is likely to outperform market expectations.

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