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Ligand (LGND) Beats Q1 Earnings and Revenue Estimates

La Jolla, CA-based Ligand Pharmaceuticals Incorporated LGND is a biotechnology company with a focus on drug discovery, reformulation and partnering. Ligand’s Captisol formulation technology has allowed it to enter into several licensing deals with companies like Amgen and Novartis among others and generate royalties. Ligand generates revenues in the form of royalties, license and milestone payments and sale of Captisol material.

In Jan 2016, Ligand acquired OMT, Inc. in a deal valued at about $178 million. The acquisition has added an antibody-generating platform, OmniAb, to the company’s technology portfolio.

In this scenario, investor focus remains on the company’s major pipeline assets apart from the usual top-and bottom-line numbers.

Ligand has an impressive earnings track record with the company surpassing expectations in each of the last four quarters delivering an average positive surprise of 44.15%.

Currently, Ligand has a Zacks Rank #3 (Hold), but that could definitely change following the company’s earnings report which was just released. We have highlighted some of the key stats from this just-revealed announcement below:

Earnings: Ligand’s first-quarter 2016 earnings surpassed expectations by a wide margin. The company reported EPS of 79 cents (including stock-based compensation expense) while our consensus called for EPS of 46 cents.

Revenues: Revenues in the reported quarter also came in above expectations. Ligand posted revenues of $29.6 million, compared to our consensus estimate of $26 million.

Key Stats: Once again, Ligand delivered higher royalty revenues on the back of Promacta and Kyprolis sales. Meanwhile, Ligand announced the acquisition of economic rights to multiple programs owned by CorMatrix. Ligand will pay $17.5 million and in exchange will receive a portion of revenue (synthetic royalty) from CorMatrix’s existing marketed products and will have the right to receive future synthetic royalties from potential future products.

Updates 2016 Guidance: Ligand updated its guidance for 2016. Including the effects of the synthetic royalty acquisition from CorMatrix, Ligand now expects to earn $3.41–$3.46 per share (old guidance: $3.37–$3.42 per share) on total revenues of $115–$119 million (old guidance: $114–$118 million) in 2016. The Zacks Consensus Estimate for earnings is $2.70 per share on revenues of $117 million.

Check back later for our full write up on this LGND earnings report later!

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