Ebb & Flow
Like many top tier biotechs, Genentech (DNA) does not provide any product-specific sales guidance, leaving Street forecasters to take their best guess at upcoming sales and earnings. While DNA may or may not care whether its analysts are on target, the stock can get a haircut when the numbers come in below the consensus.
Indeed, DNA lost almost $600 million of market cap last week despite reporting what seemed to be a double dose of good news. The company received FDA approval for an sBLA for Avastin to treat non-small cell lung cancer (NSCLC), while DNA's third quarter EPS figures eclipsed the consensus. But many of DNA's analysts decided the third quarter was lousy, mostly because sales of many of the company's drugs fell short of expectations (see "Analyst Picks," A15). ...