Seattle Genetics Third Quarter Earnings Sneak Peek

Seattle Genetics, Inc. (NASDAQ:SGEN) will unveil its latest earnings on Wednesday, November 7, 2012. Seattle Genetics is a biotechnology company focused on the development and commercialization of monoclonal antibody-based therapies for the treatment of cancer and autoimmune disease.

Seattle Genetics, Inc. Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for a loss of 15 cents per share, a narrower loss from the year-earlier quarter net loss of 35 cents. During the past three months, the average estimate has moved down from a loss of 13 cents. Between one and three months ago, the average estimate moved down. It has been unchanged at a loss of 15 cents during the last month.

Past Earnings Performance: Last quarter, the company saw net loss of 15 cents per share versus a mean estimate of a loss of 15 cents per share. This comes after two consecutive quarters of exceeding expectations.

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Wall St. Revenue Expectations: On average, analysts predict $52.7 million in revenue this quarter, a rise of more than twofold from the year-ago quarter. Analysts are forecasting total revenue of $209 million for the year, a rise of more than twofold from last year’s revenue of $94.8 million.

A Look Back: In the second quarter, the company’s loss narrowed to a loss of $17.2 million (15 cents a share) from a loss of $51.5 million (45 cents) a year earlier, meeting analyst expectations. Revenue rose more than threefold to $48.8 million from $13.1 million.

Stock Price Performance: Between September 6, 2012 and November 1, 2012, the stock price had fallen $4.32 (-14.6%), from $29.68 to $25.35. The stock price saw one of its best stretches over the last year between January 3, 2012 and January 12, 2012, when shares rose for eight straight days, increasing 12.4% (+$2.04) over that span. It saw one of its worst periods between October 17, 2012 and October 24, 2012 when shares fell for six straight days, dropping 7.9% (-$2.17) over that span.

Key Stats:

With double-digit revenue growth the past four quarters, this earnings release is a chance to keep that positive trend going. The company has averaged year-over-year revenue growth of more than threefold over the last four quarters.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 4.67 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands. The company regressed in this liquidity measure from 5.23 in the first quarter to the last quarter driven in part by an increase in liabilities. Current liabilities increased 14.3% to $84.6 million while assets rose 2% to $395.1 million.

Analyst Ratings: With five analysts rating the stock as a buy, one rating it as a sell and five rating it as a hold, there are indications of a bullish outlook.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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