Stocks & Shares

GlaxoSmithKline’s stock prints a record high since 2002

  • GSK posted earnings of 95 cents per share against Zacks Consensus estimate of 83 cents per share.
  • Revenue was reported at £9.4 billion versus analysts forecast of £9.2 billion.
  • Shingrix shingle vaccine marked an 87% increase in sales.
  • GSK expected to file for three new innovative drugs for tumors at the end of 2019.
  • GSK's stock is currently trading at 1,775 GBX level that was last seen in 2002.

Following the largely positive outlook highlighted by the Q3 earnings report, GlaxoSmithKline’s shares have printed a record high in the stock market in almost 17 years. As per the report, GSK has beaten analysts forecast for revenue and earnings in the third quarter by a significant margin.

GSK Beats Zacks Consensus Estimate For Earnings Per Share

GSK has posted Q3 earnings of 95 cents per share (EPS) against the Zacks Consensus estimate of 83 cents per share. The drug manufacturer had previously forecasted a 3-5% drop in adjusted earnings per share (year-on-year) for 2019. Following the Q3 earnings report, however, the estimate has been upgraded with GSK now expecting the adjusted EPS to match the figure for last year in the full-year (FY) earnings report.

Officials from the company have reported that there are plans of keeping 2019’s dividends at 80p for each share.

It was further added that greater investments secured by the R&D (research and development) department, impeccable operating performance, and lower than expected tax rates for 2019, are among a few of the prominent reasons why FY forecast has been upgraded.

GSK has reported £9.4 billion in revenue for the third quarter that marks a significant 16% increase (year-on-year), while the adjusted operating profit hiked by 10% and is reported at £2.8 billion in Q3. Zacks Consensus had estimated revenue of £9.2 billion for GSK.

As per the report, £535 million of sales have been noted in the Shingrix shingle vaccine (87% increase). On the other hand, HIV and respiratory divisions have printed a sale of £1.3 billion (5% increase) and £806 million (25% increase).

GSK Is Set To File For Three New Innovative Drugs For Tumors At The End Of 2019

The chief executive of GSK, Emma Walmsley, has expressed her excitement for the oncology segments that she remarked, “looked particularly promising”. The drug manufacturer has already announced that the department of Oncology is set to launch three new innovative drugs at the end of 2019.

Earlier in October, GSK was weighed down by reports of Zantac (GSK’s drug for heartburn) being contaminated with a possible carcinogen. The company had immediately recalled the entire stock over concerns of the U.S and U.K based regulators. As per the stock performance, however, the news failed to keep the share prices under pressure with the stock posting 0.6% gains following the Q3 earnings report on Wednesday. As of mid-afternoon earlier today, GSK was seen exchanging hands at 1,752p; a level that was last seen in 2002. At the time of writing, GSK is trading at 1,775 GBX.

Hargreaves Lansdown’s equity analyst, Nicholas Hyett, made a comment following GSK’s earnings report that Advair inhaler’s sales have been unimpressed for the past few years and have weighed down on the overall financial performance of the company. In the third quarter, however, Shingrix has posted remarkably better than expected results that have helped even out the overall earnings and revenue for GSK.

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