Verona Pharma is Tuesday's IBD Stock Of The Day. Shares are testing a buy point after the biotech broke out last week as its COPD treatment obliterated first-quarter sales expectations.
Ohtuvayre treats chronic obstructive pulmonary disease, a progressive lung disease that makes it difficult to breathe. Verona's drug is the first inhaled treatment for COPD. It relaxes the muscles in the lungs and widens the airways by blocking two specific enzymes.
Shares hit a record 74.18 last week after breaking out of a consolidation with a buy point at 70.40. Verona stock fell back to test that entry on Tuesday. The buy zone runs up to 73.92, according to MarketSurge.
Verona Pharma: 'Dramatic Uptake' For Ohtuvayre
During the first quarter, Ohtuvayre generated $71.3 million in sales, growing 95% sequentially. That crushed expectations for $50.3 million, according to FactSet. Total sales, which include collaboration revenue, came in at $76.3 million, beating forecasts for $53.4 million.
The company says there were 25,000 Ohtuvayre prescriptions filled in the first quarter.
"The dramatic uptake of Ohtuvayre underscores the unmet need of patients with COPD," Verona Pharma Chief Executive David Zaccardelli said in a written statement. "To continue to deepen the prescriber base and further accelerate the launch, we plan to add approximately 30 new sales representatives in the third quarter."
On a strict, as-reported basis, Verona lost 2 cents per share. That topped forecasts for an 8-cent loss and narrowed from a 4-cent loss in the year-earlier period.
Verona Pharma didn't provide an outlook for the year. But analysts expect the company to earn 14 cents per share, on a reported basis, and an adjusted 63 cents per share. Both would flip from a year-earlier loss. Analysts also project $403.9 million in sales, with 97% of that coming from Ohtuvayre.
Highly Rated Verona Stock
Shares of Verona Pharma have a perfect IBD Digital Relative Strength Rating of 99. This means they rank in the leading 1% of all stocks in terms of 12-month performance. The Composite Rating, a measure of fundamental and technical metrics, is lower at 80 out of a best-possible 99.
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