With the big bunch of S&P 500 Index components having released their Q3 FY2021 earnings reports in October, we’re kicking off November with more companies following suit, 167 to be exact, but investor focus will be on how much Big Pharma racked in, in the quarter.
Last week, Johnson & Johnson (ticker: JNJ) released its Q3 FY2021 earnings report that showed the company earning revenues of $500 million in the quarter, so analysts and investors are waiting to see what Pfizer Inc. (ticker: PFE) and Moderna Inc. (ticker: MRNA) will report.
Analysts expect these two companies to post more revenue from Q3 FY2021 than they collected in the first half of the year (H1 FY2021), in which they collectively reported sales of $17.2 billion, all from their COVID-19 vaccines. Analysts expect these companies to report $18 billion collectively in Q3 FY2021. It should be noted that Pfizer was the first pharmaceutical company to announce the discovery of a COVID-19 vaccine in November last year, in collaboration with German biotechnology company BioNTech SE (BNTX), and Moderna followed in December.
Pfizer, one of the biggest pharmaceutical companies in the world, will release its earnings report for the third quarter of the 2021 fiscal year that ended in September 2021, tomorrow after the closing bell. The company is expected to keep beating expectations in revenue and Earnings Per Share (EPS) as it has been doing in the previous two quarters of this fiscal year.
In the first half of the year that ended on June 30, 2021, Pfizer reported total revenue of $33.56 billion and $11.3 billion came from COVID-19 vaccines only. This quarter alone, the company is expected to post revenue of $11.86 billion from COVID-19 sales. Over the weekend, the Food and Drug Authority (FDA) approved the Pfizer vaccine, officially known as Comirnaty, to be administered to children between 5 and 11 years starting this week. Hence, analysts believe this could further boost the company’s earnings.
However, early in October, analysts at banking holding company Mizuho Financial Group, Inc. (ticker: MFG) wrote to investors that Pfizer could struggle to make $10 billion from COVID-19 vaccine sales in Q3 FY2021 even though sales estimates are unchanged for the company.
The analysts based their opinion on numerous factors and believe that Q3 FY2021 revenues could be shifted to Q4 due to developments like administering vaccines to younger children and booster shots to adults that have already been vaccinated. Mizuho analysts currently have a neutral rating on Pfizer stock, and their price target is $43. Pfizer stock is currently trading at $43.74 a share with a market capitalisation of $245.24 billion. This stock has gained 6.93% year to date, according to data from Google Finance.
Moderna will release its Q3 FY2021 earnings report on Thursday morning, November 4, 2021. The company is expected to post $6.17 billion from COVID-19 sales in the quarter, more than the $5.93 billion it reported in the first two quarters of the 2021 fiscal year.
Unlike giants Johnson & Johnson and Pfizer that have existed for more than a century, Moderna is a fairly new player founded in 2010 by Noubar Afeyan, Robert Langer, Kenneth R. Chien, and Derrick Rossi. The young company sees its COVID-19 vaccine as an essential revenue stream since it’s the first of its products to be approved for use by the FDA.
In Q2 FY2021, Moderna registered sales of $4.35 billion, but consensus analysts expect the company to post better results in Q3 FY2021 as the company has been at the forefront of the COVID-19 vaccine production since the last quarter of the 2020 fiscal year (Q4 FY2020).
Moderna stock is currently trading at $345.21 a share, and the company is one of the biggest movers this year, having gained a tremendous 208.97% year to date. The company has a market capitalisation of $139.34 billion, having gone public less than three years ago.
Big Pharma aside, there are more than 100 other companies set to report their quarterly earnings this week. Notable names include ride-hailing companies Uber Technologies Inc. (ticker: UBER) and Lyft Inc. (ticker: LYFT), as well as gambling companies Caesars Entertainment Inc. (ticker: CZR) and MGM Resorts International (ticker: MGM).
Ride-hailing companies took a heavy hit at the height of the pandemic last year as governments around the globe almost entirely shut down the transport sector due to stay-at-home directives.
Although economies are almost entirely open around the world, Uber is struggling with staff shortages, so analysts and investors alike are keen on seeing what the company says about this and how it has affected its revenue in the coming earnings call that will be held on November 4, 2021, after market close.
Uber’s stock is still struggling, having dropped as much as 14.31% so far this year, currently trading at $43.82 a share. The company has a market capitalisation of $82.57 billion. The company’s closest competitor, Lyft, has had a year filled with ups and downs, but its stock has dropped only 2.98% in the same period. Lyft, which will report its Q3 FY2021 earnings tomorrow, Tuesday, November 2, 2021, has a market capitalisation of $15.38 billion, with its shares trading at $45.87 each.
This week, gambling companies that are releasing their Q3 FY2021 earnings reports include Caesars (Tuesday), MGM Resorts (Wednesday), Penn National Gaming Inc. (ticker: PENN, Thursday), and DraftKings Inc. (ticker: DKNG, Friday). Analysts at Truist Securities said that the gambling sector is one of the few sectors that made a strong comeback from COVID-19-related effects.
Other companies reporting this week are airline and hotel booking company Booking Inc. (ticker: BKNG, Wednesday), vacation-rental company Airbnb Inc. (ticker: ABNB, Thursday), online-travel company Expedia Group Inc. (ticker: EXPE, Thursday), as well as tech companies Roku Inc. (ticker: ROKU), Pinterest Inc. (ticker: PINS), and Fastly Inc. (ticker: FSLY).