What happened

Shares of the generic and specialty drug maker Amneal Pharmaceuticals (NYSE:AMRX) fell by more than 19% in early-morning trading today on heavy volume. The culprit?

Amneal released its first-quarter earnings report before the opening bell this morning, and it apparently didn't go over well with investors. Although the company beat consensus on revenue by a modest $7.4 million (approximately 1.7% higher than expected), Amneal also posted a hefty net loss of $125 million for the quarter.

Chalkboard chart showing a downward-pointing trend line.

Image Source: Getty Images.

So what

Amneal gave a litany of reasons for its poor bottom-line performance during the first quarter. Topping the list, the company noted that a $76 million impairment charge, expenses associated with the merger with Impax and follow-on acquisition of Gemini, as well as restructuring costs and the impact of unfavorable foreign exchange rates, all weighed on its bottom line over the three-month period.

This sizable net loss is certainly regrettable, but it's not the end of the world, either. Amneal's generic drug unit has now launched a whopping 46 new products over the past 16 months, driving a 7% uptick in net revenue for this unit in the last year. The market, therefore, appears to be dramatically overreacting to this earnings report.

Now what

Is Amneal a bad-news buy? While the North American generic market has been headed in the wrong direction for almost three years now, Amneal has still managed to grow its generic drug business in this unfavorable environment. Additionally, the company sports biosimilar and specialty drug units that are on the upswing.

Taken together, these three segments are forecast to keep Amneal's top line headed higher for at least the next two years. As a result, bargain hunters may want to consider taking advantage of this double-digit dip today.