As we enter the heart of second-quarter earnings reports, I can’t help but point out that the majority we’ve covered over the past year have been better than expected. With so many companies reporting during the weeks that comprise earnings season, it’s easy for some earnings reports to fall through the cracks.
Each week for the past year, I’ve taken a look at three companies that could be worth further research after either beating or missing their profit expectations. Today, we’ll take a gander at three more companies that reported earnings last week. They may have slid under your radar, but they deserve a look.
| Company | Consensus EPS | Reported EPS | Surprise |
|---|---|---|---|
| NVIDIA Corporation (NASDAQ:NVDA) | $0.10 | $0.13 | 30% |
| Onyx Pharmaceuticals, Inc. (NASDAQ:ONXX) | ($0.47) | ($0.19) | 60% |
| Monster Beverage Corp (NASDAQ:MNST) | $0.46 | $0.37 | -20% |
Source: Yahoo! Finance.
NVIDIA
For the quarter, revenue rose 3% to nearly $955 million as EPS expanded to $0.13 from $0.10 in the year-ago period. What’s really to note was that its Tegra chip sales for tablets and smartphones dropped 22% as the company transitions from Tegra 3 to its all-new Tegra 4 chips. Despite the drop-off in sales, NVIDIA Corporation (NASDAQ:NVDA) still managed to expand gross margin by 4 percentage points to 54% and delivered a nice boost in graphic chip sales despite weakness in the PC industry.
Furthermore, Project Shield, the company’s handheld gaming device, is poised to ship in the upcoming fiscal quarter. Although gaming hasn’t exactly been a top performer over the past couple of years due to the commoditization and digitization of the industry, combining NVIDIA Corporation (NASDAQ:NVDA)’s graphics and processing capabilities should allow it to set itself apart from the field. The other interesting aspect of this expected launch is that it comes on the heels of the expected debut of Microsoft‘s new Xbox and Sony‘s PlayStation in the second half of the year.
As I stated last month, there’s nothing graphic about NVIDIA’s potential, and you’d be foolish not to have this company firmly planted on your Watchlist.
Onyx Pharmaceuticals
In September of last year I exclaimed that biopharmaceutical company Onyx Pharmaceuticals, Inc. (NASDAQ:ONXX) would be heading to $100. It appears that its first-quarter report, while still in the red, could help this rapidly growing and innovative company hurdle that mark.
For its most recent quarter, Onyx Pharmaceuticals, Inc. (NASDAQ:ONXX) delivered a doubling in revenue to $145.5 million from $72 million in the previous year, with practically all of the gains coming from multiple myeloma drug Kyprolis. Sales of Kyprolis totaled $64 million this quarter, which is phenomenal for a drug that was only approved in July. Nexavar sales were a bit disappointing, falling 2% from the previous year to $70.3 million. However, Nexavar, which is already approved to treat the most common form of kidney and liver cancer, looks poised to gain the additional indication of metastatic thyroid cancer if trial data keeps working in its favor.
Kyprolis won’t have a completely clear path to success in spite of its rapid sales ascent due to the accelerated approval of Celgene (NASDAQ:CELG)‘s Pomalyst in February. Kyprolis delivered a slightly better median duration of response at 7.8 months versus 7.4 months, yet Pomalyst combined with a low-dose dexamethasone produced a higher overall response rate of 29.2% as compared to 23% for Kyprolis. I feel that the multiple myeloma market is certainly big enough, and in need of any help it can get, that both drugs will be accommodated.
With a loss that was significantly narrower than expected and $739 million in cash and cash equivalents, Onyx Pharmaceuticals, Inc. (NASDAQ:ONXX) still represents an intriguing buyout candidate for a big pharmaceutical company itching for a growing pipeline of products.
