Savvy Trades and Investments

[abh3vt]

I added some more HALO today around 34/sh. I guess some investors didn't like the presentation given by the company today. Lots of info in there, so its worth a listen to those who are interested in this seemingly cheap biotech company:

https://ir.halozyme.com/events-and-presentations/events/event-details/2024/Halozyme-Financial-Update-Call/default.aspx

They provided an update on Q4 (revenue a little lower than expected, but EPS came in at the high end of the range.)
From the company filed 8K
Unaudited Preliminary Estimates of Results for the Twelve Months Ended December 31, 2023
The Company estimates 2023 Revenue will be in the range of $827 million to $832 million.
The Company estimates 2023 royalties will be in the range of $445 million to $450 million.
The Company estimates 2023 Net Income will be in the range of $292 million to $297 million, 2023 EBITDA will be in the range of $435 million to $440 million and 2023 Adjusted EBITDA will be in the range of $425 million to $430 million.
The Company estimates 2023 GAAP Diluted EPS will be in the range of $2.18 to $2.21 and 2023 Non-GAAP Diluted EPS will be in the range of $2.77 to $2.80.

First guide for FY24 (see slide 24 for more details):
https://s28.q4cdn.com/284259014/files/doc_events/2024/01/HalozymeFinancialUpdateJanuary2024-FINAL.pdf

FY24 Rev: 915 - 985
FY24 adj EPS: 3.55 - 3.90 (MP: 3.73)

Just a tad below consensus on FY24 earnings, and well below on revs. During the call, the company explained how and why its margins on EBITDA should be strong and likely to continue increasing over the next 4 years. A chunk of those EBITDA adjustments are non-cash and get backed out of adjusted Pretax....hence the stronger margins and better eps than expected at that revenue level. I thought they did a good job addressing the concerns about patent cliffs and their ability to maintain margins in later years of the patents. If 2024 is indeed going to be a tough year for the economy, I'd think steady, stable growth in healthcare would be more desirable, but what do I know?