The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Ligand Pharmaceuticals crushed expectations on revenue and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded significantly and GAAP earnings per share improved.
Gross margins dropped, operating margins grew, and net margins shrank.
Ligand Pharmaceuticals booked revenue of $12.9 million. The one analyst polled by S&P Capital IQ expected revenue of $8.2 million. Sales were much higher than the prior-year quarter's $3.9 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
EPS came in at $0.24. The one earnings estimate compiled by S&P Capital IQ anticipated $0.02 per share. GAAP EPS of $0.24 for Q4 were 4.3% higher than the prior-year quarter's $0.23 per share.
Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.
For the quarter, gross margin was 84.1%, 23,560 basis points worse than the prior-year quarter. Operating margin was 35.3%, 10,330 basis points better than the prior-year quarter. Net margin was 37.2%, 7,710 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $8.3 million. On the bottom line, the average EPS estimate is $0.01.
Next year's average estimate for revenue is $30.7 million. The average EPS estimate is -$0.09.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 162 members out of 179 rating the stock outperform, and 17 members rating it underperform. Among 51 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 46 give Ligand Pharmaceuticals a green thumbs-up, and five give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Ligand Pharmaceuticals is buy, with an average price target of $24.00.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.