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Amneal Pharmaceuticals (NYSE:AMRX) Q3 Earnings: What Can You Expect?

in EARNINGS/INVESTING IDEAS by

Amneal Pharmaceuticals, Inc. (NYSE:AMRX) is scheduled to report Q3 earnings results before markets open for trading on November 6, 2020.

The company is expected to report earnings of $0.12/share on revenue of $482.2 million. The consensus earnings per share (EPS) of $0.12/share is based on a poll of 11 analysts and represents a growth in eps of 204.0% over the same quarter last year, when the company reported earnings of $0.04/share.

The revenue forecast of $482.2 million based on a poll of 9 analysts implies a year-over-year (YoY) growth in revenue of 27.5%. Last year the company reported $378.3 million in revenue for the quarter.

Expected to report EPS growth of 204.0% for Q3, 2020
Metric Expected Prior Year YoY Change
Revenue $482.22 $378.28 27.5%
EPS $0.12 $0.04 204.0%

Earnings Call Trends

Historically, management has exceeded analyst expectations 5 out of the last 8 tracked quarters, and missed expectations 3 quarters.

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

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q2, 2020 $0.10 $0.13 34.9% Beat
Q1, 2020 $0.09 $0.20 123.2% Beat
Q4, 2019 $0.05 $0.08 56.5% Beat
Q3, 2019 $0.13 $0.04 −68.6% Missed
Q2, 2019 $0.12 $0.09 −27.2% Missed
Q1, 2019 $0.18 $0.14 −20.9% Missed
Q4, 2018 $0.27 $0.33 21.0% Beat
Q3, 2018 $0.27 $0.28 2.2% 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 falling −16.3%.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
August 6, 2020 $5.27 $4.41 −16.3% Decline
May 11, 2020 $3.55 $4.27 20.3% Increase
February 26, 2020 $4.76 $3.79 −20.4% Decline
November 6, 2019 $3.44 $2.65 −23.0% 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 −3.24, the model suggests that the company is not likely to be an earnings manipulator. A value of −3.24 implies a 0.1% chance of earnings manipulation.

Fundamentals And Technical Analysis

Amneal Pharmaceuticals, Inc. is currently trading at $4.16/share, down −4.6% for the day. The company is trading at approximately 71.8% of its 52-week high of $5.79/share. The company’s stock price is down −5.7% since the last earnings report and down −20.2% over the previous week. The company’s 14 Day Relative Price Index (RSI) of 35.14 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.


NYSE:AMRX Stock Price Chart
Source: Finbox

The current share price implies a price-to-earnings (P/E) multiple of −3.16 and a forward P/E multiple of 3.56.

Amneal Pharmaceuticals, Inc.’s current share price also implies a price-to-book (P/B) multiple of 4.07. The following table summarizes some other key fundamental ratios:

Data as of November 1, 2020
Metric Value
Last Reported Fiscal Period Key FY2020.Q2
Period End Date June 30, 2020
Stock Price (Current) $4.16
P/E Ratio −3.2x
P/E Ratio (Fwd) 3.6x
PEG Ratio 0.0
Total Debt / Total Capital 68.6%
Levered Free Cash Flow $283.8 million
EV / EBITDA 10.1x

Finbox

Amneal Pharmaceuticals, Inc. is a small-cap stock with a market capitalization of $613.8 million and a total enterprise value of $3.453 billion. The company operates in the Healthcare sector and the Pharmaceuticals industry.

Amneal Pharmaceuticals, Inc., together with its subsidiaries, develops, licenses, manufactures, markets, and distributes generic and specialty pharmaceutical products for various dosage forms and therapeutic areas. The company operates in two segments, Generics and Specialty. The Generics segment develops, manufactures, and commercializes complex oral solids, injectables, ophthalmics, liquids, topicals, softgels, inhalation products, and transdermals across a range of therapeutic categories. The Specialty segment is involved in the development, manufacture, and sale of branded pharmaceutical products primarily for central nervous system disorders, endocrinology, parasitic infections, and other therapeutic areas. It also offers licensed and owned, niche, and mature branded products, as well as Rytary for the treatment of Parkinsons Disease; Zomig for the treatment of migraine headaches; Emverm a chewable tablets for the treatment of pinworm, whipworm, common roundworm, common hookworm, and American hookworm in single or mixed infections; and Unithroid for the treatment of hypothyroidism. The company sells its products through wholesalers, distributors, hospitals, chain pharmacies, and individual pharmacies. It has operations in the United States, India, Ireland, and internationally. The company was formerly known as Atlas Holdings, Inc. and changed its name to Amneal Pharmaceuticals, Inc. in 2018. Amneal Pharmaceuticals, Inc. was founded in 2002 and is based in Bridgewater, New Jersey.

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