What To Expect From Royalty Pharma's (RPRX) Q3 Earnings

Healthcare royalties company Royalty Pharma (NASDAQ:RPRX) will be reporting earnings this Wednesday before the bell. Here’s what to look for.

Royalty Pharma missed analysts’ revenue expectations by 1.9% last quarter, reporting revenues of $578.7 million, up 7.7% year on year. It was a slower quarter for the company, with a miss of analysts’ revenue estimates.

Is Royalty Pharma a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.

This quarter, analysts are expecting Royalty Pharma’s revenue to grow 10.7% year on year to $625.3 million, improving from the 5.3% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $1.04 per share.

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings.

Looking at Royalty Pharma’s peers in the branded pharmaceuticals segment, some have already reported their Q3 results, giving us a hint as to what we can expect. Eli Lilly delivered year-on-year revenue growth of 53.9%, beating analysts’ expectations by 9.6%, and Bristol-Myers Squibb reported revenues up 2.9%, topping estimates by 3.7%. Eli Lilly traded up 6% following the results while Bristol-Myers Squibb was also up 8.1%.

Read our full analysis of Eli Lilly’s results here and Bristol-Myers Squibb’s results here.

Investors in the branded pharmaceuticals segment have had steady hands going into earnings, with share prices flat over the last month. Royalty Pharma is up 4.6% during the same time and is heading into earnings with an average analyst price target of $44.10 (compared to the current share price of $37.80).

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