Santarus, Inc. (SNTS), Jazz Pharmaceuticals plc – Ordinary Shares (JAZZ): Three Earning Catalysts That Could Push This Biotech Even Higher

Strangely, Ariad Pharmaceuticals, Inc. (NASDAQ:ARIA)’s Iclusig supports a multibillion-dollar market cap, but Santarus’ Uceris performed just as well during its launch. Uceris looks to be a hidden gem in Santarus’ product line, and with only five weeks of revenue, it will be very interesting to see how Uceris performs in a full quarter. I think a comparison of the potential blockbuster Iclusig and Uceris will be interesting to monitor in Q2.

Guidance

Santarus has upped its guidance for the last two quarters. In the fourth quarter full-year revenue guidance was raised from $310 million to $320 million. Last quarter, revenue guidance was raised to $335 million.

Now, with Uceris’ sudden success, and a re-launch of Glumetza, will the company raise guidance again?

Conclusion

Santarus proclaims that its current product line could produce sales of $700 million total. Glumetza, Zegerid, and Ulceris are tied to the majority of this potential. However, Uceris is the wild card, and with robust growth, Santarus could raise long-term guidance.

Moreover, with a $1.6 billion market cap, the company trades at 6.4 times sales, which isn’t cheap. However, when you consider its long-term potential, then Santarus is trading at a more favorable 2.3 times peak sales.

As a result, I conclude that because of Santarus’ valuation, it could trade lower after earnings, and will have to excel in each of the noted areas in order to trade higher. However as a long-term investment, I still think Santarus is solid, and would recommend it to any buy-and-hold investor.

The article 3 Earning Catalysts That Could Push This Biotech Even Higher originally appeared on Fool.com and is written by Sherrie Stone.

Sherrie Stone has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Sherrie is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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