Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of Nektar Therapeutics (NASDAQ:NKTR), a biopharmaceutical company that develops therapies along its PEGylation and polymer conjugate technology platforms, jumped as much as 22% after reporting better-than-expected third-quarter earnings results.
So what: For the quarter, Nektar reported a monstrous 231% increase in year-over-year revenue to $60.9 million, which it attributed to higher product sales and a $25 million milestone payment associated with Europe's acceptance of naloxegol's marketing authorization application filing. Net loss shrank dramatically despite higher research and development costs to just $16.5 million from $43.5 million in the year prior. On an adjusted basis, Nektar reported a loss of just $0.14 per share. Comparatively, Wall Street anticipated a much wider loss of $0.25 per share and just $51.4 million in revenue, so this was a sizable beat.
Now what: You often won't hear me say this often about biopharmaceutical companies operating in the red, but I'm a big fan of Nektar Therapeutics. The company offers investors so many ways to potentially make money through royalty revenue via its proprietary technology program, by developing wholly in-house therapies utilizing that platform, and by possibly selling its royalty streams to generate cash for future studies. Nektar also boasts a handful of partnerships with some of big pharma's largest names. In addition, it has an established product portfolio, as well as 19 compounds currently in the preclinical and/or clinical stage of the study process. Simply put, the more pitches you see, the more chances you have to hit a home run. With its diverse portfolio and solid earnings results, I see a lot of potential for Nektar moving forward.
Fool contributor Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.
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