Please ensure Javascript is enabled for purposes of website accessibility

Why Acadia Pharmaceuticals Jumped 11% Higher Today

By Brian Orelli, PhD – Updated May 4, 2018 at 4:21PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

First-quarter revenue growth has investors excited.

What

Shares of Acadia Pharmaceuticals (ACAD 1.36%) closed up 11% on Friday after announcing solid enough first-quarter revenue from its Parkinson's disease drug Nuplazid before the bell this morning.

Of course, with the share price at almost half of where it started the year at thanks to a negative CNN report in April, it shouldn't have taken much to get investors excited.

Pills on $100 bills

Image source: Getty Images.

So what

Nuplazid revenue was up 12% quarter over quarter, which is certainly some solid growth. But it's working off a low base, so the growth only raised quarterly sales to $48.9 million, a far cry from a blockbuster.

Investors are likely also cheering management's guidance in which it reiterated expectations for Nuplazid sales between $255 million and $270 million this year. For the second quarter, the goal is for sales of $57 million to $61 million, which would be about 20% quarter-over-quarter growth at the midpoint. More importantly, it still leaves additional growth for the second half of the year to reach the annual goal.

Now what

In addition to growing sales, investors can look forward to results from a phase 2 trial testing Nuplazid in patients with major depressive disorder (MDD), which is due out in the second half of this year. As a much larger potential market, MDD could give Acadia a major revenue boost, although sales for that indication would still be years away since the company would still need to run a phase 3 confirmatory program.

Brian Orelli has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Acadia Pharmaceuticals Stock Quote
Acadia Pharmaceuticals
ACAD
$16.36 (1.36%) $0.22

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
326%
 
S&P 500 Returns
102%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 10/01/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.