A month has gone by since the last earnings report for Sarepta Therapeutics (SRPT). Shares have added about 37% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Sarepta Therapeutics due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the latest earnings report in order to get a better handle on the important catalysts.
Q2 Earnings & Sales Beat Estimates
Sarepta reported second-quarter 2026 adjusted EPS of 64 cents, which beat the Zacks Consensus Estimate of 58 cents. However, the reported figure fell 68% year over year.
The adjusted figures exclude depreciation and amortization costs, stock-based compensation expenses, gains on strategic investments and certain interest expense/income. Including these items, EPS during the second quarter stood at a loss of 5 cents against earnings of $1.89 in the year-ago period.
Sarepta recorded total revenues of $401.3 million, down 34% year over year, primarily due to lower sales of Elevidys. Yet, the figure beat the Zacks Consensus Estimate of $355.6 million.
Product Sales Top Expectations
PMO product revenues totaled $230.6 million, relatively flat year over year. The figure beat the Zacks Consensus Estimate of $225.9 million. Management attributed the PMO franchise's durability to stable demand, extensive real-world experience and established safety profiles.
Elevidys' revenues were $98.1 million, down 65% year over year, primarily due to its decision to suspend shipments to non-ambulatory patients in June 2025 amid safety concerns. Nonetheless, the therapy's sales marginally beat the Zacks Consensus Estimate of $97.8 million.
Other Revenues Support Results
Collaboration and other revenues totaled $72.6 million, down 26% year over year. The year-ago period benefited from a $63.5 million milestone payment received from Roche related to the regulatory approval of Elevidys in Japan, with no comparable payment in the reported quarter.
The decline was partly offset by a $27.4 million increase in contract manufacturing revenues associated with higher commercial Elevidys supply delivered to Roche. Sarepta also recognized $10 million in license revenues related to intellectual property rights granted under a licensing agreement.
Cuts Operating Costs
Adjusted research and development (R&D) expenses declined 58% year over year to $76.7 million. The reduction reflected lower manufacturing and clinical spending following Sarepta's pipeline reprioritization and lower employee-related costs under the July 2025 restructuring program.
Adjusted selling, general and administrative (SG&A) expenses decreased 22% to $88 million, driven by lower personnel costs and reduced professional services related to Elevidys commercialization.
Updates '26 Outlook
Sarepta narrowed its 2026 net product revenue guidance to $1.2-$1.3 billion from the previous range of $1.2-$1.4 billion.
The company expects second-half product revenues to be modestly lower than first-half levels. Elevidys revenues are also projected to decline sequentially in the third quarter because revenue recognition reflects patients who entered the treatment process several months earlier.
Enrollment forms improved sequentially during the second quarter, supported by Sarepta's expanded commercial team and increased engagement with health care providers.
However, the roughly six-month journey from enrollment to infusion means the recent improvement is expected to benefit revenues more meaningfully in 2027.
The company raised its 2026 collaboration and other revenues forecast to $550-$600 million, primarily due to higher expected contract manufacturing revenues. The new guidance marked an increase of $75 million from the midpoint of the company's previous guidance.
Sarepta tightened its combined adjusted R&D and SG&A expense guidance to $800-$850 million from $800-$900 million.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
The consensus estimate has shifted -11.11% due to these changes.
VGM Scores
Currently, Sarepta Therapeutics has a average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, the stock has a grade of B on the value side, putting it in the second quintile for value investors.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Sarepta Therapeutics has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Sarepta Therapeutics belongs to the Zacks Medical - Biomedical and Genetics industry. Another stock from the same industry, Pacira (PCRX), has gained 4% over the past month. More than a month has passed since the company reported results for the quarter ended June 2026.
Pacira reported revenues of $192.4 million in the last reported quarter, representing a year-over-year change of +6.2%. EPS of $0.73 for the same period compares with $0.74 a year ago.
Pacira is expected to post earnings of $0.76 per share for the current quarter, representing a year-over-year change of +8.6%. Over the last 30 days, the Zacks Consensus Estimate has changed -2.1%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Pacira. Also, the stock has a VGM Score of A.
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This article originally published on Zacks Investment Research (zacks.com).
