Arcellx Reports Smaller Loss, Outpaced Earnings Estimates
A Decent Beat Amid Revenue Shortfalls
Arcellx, Inc. (ACLX) reported a quarterly loss of $0.48 per share, slightly better than the Zacks Consensus Estimate of a loss of $0.54. This marks an improvement from last year’s loss of $0.81 per share. All figures have been adjusted for non-recurring items.
This quarterly results indicate a positive earnings surprise of 11.11%. Just three months ago, Arcellx was expected to lose $0.54 per share, but it actually reported a loss of $0.51, resulting in a surprise of 5.56%.
Remarkably, over the last four quarters, the company has consistently exceeded consensus EPS estimates.
For the quarter ending September 2024, Arcellx’s revenues reached $26.03 million, missing the Zacks Consensus Estimate by 26.06%. Comparatively, revenues from the same period last year stood at $14.96 million. The company managed to surpass consensus revenue estimates twice in the past four quarters.
The future trajectory of the stock, based on the recent earnings report and upcoming earnings expectations, will heavily rely on management’s discussion during the earnings call.
Since the start of this year, Arcellx’s shares have surged by approximately 67.5%, while the S&P 500 has increased by 24.3%.
Future Prospects for Arcellx
As Arcellx continues to outperform the market this year, investors are left pondering the stock’s future path.
There are no straightforward answers, but one useful metric to gauge the company’s earnings outlook is its consensus earnings expectations for upcoming quarters. Notably, recent changes in these expectations are also significant.
Research shows a strong connection between short-term stock movements and earnings estimate revisions. Investors can monitor these revisions independently or through resources like the Zacks Rank, which has a solid track record in this area.
Before this earnings release, the estimate revisions trend for Arcellx was mixed. Following the latest earnings report, this status reflects a Zacks Rank of #3 (Hold) for the stock, indicating that shares are expected to perform in line with the market soon.
Investors should watch for how estimates for the upcoming quarters and the current fiscal year may change shortly. Presently, the consensus EPS estimate for the next quarter stands at -$0.55 on revenues of $26.63 million, and -$1.65 on revenues of $128.46 million for the full fiscal year.
Additionally, the industry outlook plays a crucial role in stock performance. The Medical – Biomedical and Genetics industry currently ranks in the top 36% of over 250 Zacks industries. Research indicates that the top 50% of Zacks-ranked industries outperform the bottom half by more than double.
In related news, Revance Therapeutics, Inc. (RVNC), another player in the same industry, has not yet reported its results for the quarter ended September 2024.
This company is projected to post a quarterly loss of $0.35 per share, reflecting a year-over-year change of +52.7%. Its consensus EPS estimate has remained stable over the past 30 days.
Revance Therapeutics is expected to report revenues of $67.73 million, marking a 19.3% increase from this time last year.
Analyst’s Top Stock Pick
From a selection of thousands, five Zacks analysts have identified their top picks expected to rise +100% or more in the coming months. Among these, Director of Research Sheraz Mian has singled out one company anticipated to have the most significant upside potential.
This firm focuses on millennial and Gen Z markets, achieving nearly $1 billion in revenue last quarter. A recent pullback in its stock price could present a prime opportunity for new investors. While not all recommendations yield positive returns, this particular stock has the potential to significantly outperform prior Zacks’ Stocks Set to Double, such as Nano-X Imaging, which increased by +129.6% in just over nine months.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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