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Tandem Diabetes Care (NasdaqGM:TNDM) Q3 2020 Earnings Prep

in EARNINGS/INVESTING IDEAS by

Tandem Diabetes Care, Inc. (NasdaqGM:TNDM) is scheduled to report Q3 earnings results after markets close for trading on November 5, 2020.

The company is expected to report earnings of -$0.12/share on revenue of $115.2 million. The consensus earnings per share (EPS) of -$0.12/share is based on a poll of 10 analysts and represents a decline in eps of -31.1% over the same quarter last year, when the company reported earnings of -$0.09/share.

The revenue forecast of $115.2 million based on a poll of 14 analysts implies a year-over-year (YoY) growth in revenue of 21.7%. Last year the company reported $94.657 million in revenue for the quarter.

Expected to report EPS of -$0.12/share for Q3, 2020
Metric Expected Prior Year YoY Change
Revenue $115.16 $94.66 21.7%
EPS -$0.12 -$0.09 -31.1%

Earnings Call Trends

Historically, management has exceeded analyst expectations 6 out of the last 8 tracked quarters, and missed expectations 2 quarters.

What are your expectations from Tandem Diabetes Care, Inc. for earnings this quarter? Let us know in the comments!

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q2, 2020 -$0.25 -$0.23 7.9% Beat
Q1, 2020 -$0.18 -$0.25 -40.5% Missed
Q4, 2019 -$0.03 $0.04 240.0% Beat
Q3, 2019 -$0.22 -$0.09 59.8% Beat
Q2, 2019 -$0.29 -$0.03 89.7% Beat
Q1, 2019 -$0.29 -$0.40 -39.1% Missed
Q4, 2018 -$0.20 $0.02 110.3% Beat
Q3, 2018 -$0.31 -$0.30 4.5% Beat

In the following table, we summarize the company’s stock price movements after earnings releases. The “Price Day Prior” column shows the closing stock price on the day before the earnings report, and the “Price Next Day” column shows the stock price at the end of the trading day after the earnings report. After the last earnings report for the period ending June 30, 2020, the stock price reacted by increasing 1.8%.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
July 30, 2020 $102.62 $104.46 1.8% Increase
April 30, 2020 $74.57 $80.22 7.6% Increase
February 24, 2020 $88 $77.94 −11.4% Decline
November 4, 2019 $62.35 $58.30 −6.5% Decline

The other question to consider is one of earnings manipulation. There is a lot of pressure on management each quarter to deliver on earnings expectations. The Beneish M-Score is a statistical model that provides some insight into whether the company might be manipulating earnings. With a Beneish M-Score of −2.30, the model suggests that the company is not likely to be an earnings manipulator. A value of −2.30 implies a 1.1% chance of earnings manipulation.

Fundamentals And Technical Analysis

Tandem Diabetes Care, Inc. is currently trading at $113.01/share, down −1.8% for the day. The company is trading at approximately 91.4% of its 52-week high of $123.74/share. The company’s stock price is up 8.2% since the last earnings report and up 2.2% over the previous week. The company’s 14 Day Relative Price Index (RSI) of 52.19 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.


NasdaqGM:TNDM Stock Price Chart
Source: Finbox

The current share price implies a price-to-earnings (P/E) multiple of −163.40 and a forward P/E multiple of −209.78.

Tandem Diabetes Care, Inc.’s current share price also implies a price-to-book (P/B) multiple of 25.77. The following table summarizes some other key fundamental ratios:

Data as of October 28, 2020
Metric Value
Last Reported Fiscal Period Key FY2020.Q2
Period End Date June 30, 2020
Stock Price (Current) $113.01
P/E Ratio −163.4x
P/E Ratio (Fwd) −209.8x
PEG Ratio −6.3
Total Debt / Total Capital 3.1%
Levered Free Cash Flow $9.405 million
EV / EBITDA −300.1x

Finbox

Tandem Diabetes Care, Inc. is a mid-cap stock with a market capitalization of $7.007 billion and a total enterprise value of $6.803 billion. The company operates in the Healthcare sector and the Healthcare Equipment & Supplies industry.

Tandem Diabetes Care, Inc., a medical device company, designs, develops, and commercializes various products for people with insulin-dependent diabetes in the United States. The company’s flagship product is the t:slim X2 insulin delivery system, a pump platform that comprises t:slim X2 pump, its 300-unit disposable insulin cartridge, and an infusion set. It also provides t:slim X2 insulin delivery system with Basal-IQ Technology; t:slim X2 with control IQ technology; t:slim X2 with G5 Integration; and Tandem Device Updater, a tool that allows users to update their pump’s software. In addition, the company offers t:connect, a web-based data management application, which provides a visual way to display diabetes therapy management data from the pump and supported blood glucose meters for users, their caregivers, and their healthcare providers. Its products in development include t:sport insulin delivery system; and connected (mobile) health offerings. Further, the company offers Sugarmate, a mobile app for people with diabetes who use insulin. The company was formerly known as Phluid Inc. and changed its name to Tandem Diabetes Care, Inc. in January 2008. Tandem Diabetes Care, Inc. was founded in 2006 and is headquartered in San Diego, California.

Expertise: financial technology, analyzing market trends. Brian is a founder at finbox.io, where he’s focused on building tools that make it faster and easier for investors to research stock fundamentals. Brian’s background is in physics & computer science and previously worked as a software engineer at GE Healthcare. He enjoys applying his expertise in technology to help find market trends that impact investors. Brian can be reached at brian@finbox.io or at +1 (516) 778-6257.

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