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Why Medivation (MDVN) Could Beat Earnings Estimates Again

Zacks Equity Research

Looking for a stock that might be in a good position to beat earnings at its next report? Consider Medivation, Inc. (MDVN), a firm in the Biotechnology industry, which could be a great candidate for another beat.

This company has seen a nice streak of beating earnings estimates, especially when looking at the previous two reports. In fact, in these reports, MDVN has beaten estimates by at least 70% in both cases, suggesting it has a nice short-term history of crushing expectations.

Earnings in Focus

Two quarters ago, MDVN expected to report a loss of 21 cents per share, while it actually produced a loss of 7 cents per share, a beat of 66.7%. Meanwhile, for the most recent quarter, the company looked to deliver a loss of 28 cents a share, when it actually reported a loss of 18 cents per share instead, representing a 35.7% positive surprise.

Thanks in part to this history, recent estimates have been moving higher for Medivation. In fact, the Earnings ESP for MDVN is positive, which is a great sign of a coming beat.

After all, the Zacks Earnings ESP compares the most accurate estimate to the broad consensus, looking to find stocks that have seen big revisions as of late, suggesting that analysts have recently become more bullish on the company’s earnings prospects. This is the case for MDVN, as the firm currently has a Zacks Earnings ESP of 36.36%, so another beat could be around the corner.

This is particularly true when you consider that MDVN has a great Zacks Rank #2 (Buy), which can be a harbinger of outperformance and a signal for a strong earnings profile. And when you add this solid Zacks Rank to a positive Earnings ESP, a positive earnings surprise happens nearly 70% of the time, so it seems pretty likely that MDVN could see another beat at its next report, especially if recent trends are any guide.

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MEDIVATION INC (MDVN): Free Stock Analysis Report


Zacks Investment Research