Replies to post #6560 on Halozyme Therapeutics Inc (HALO)

[biotechinvestor1]

Fred, the $40 mil prediction by me (and maumar initially) is for ROYALTIES only. You took the $40 mil in our royalty prediction and divided it by the 140 mil in the number of shares and wrongly came up with “$0.28 revenue per share”

But surely, you must understand that there is a difference between royalties and total revenue. Revenue has multiple components. In addition to royalties, Halozyme receives milestones and bulk sales (for clinical trials). In some quarters the milestones and bulk sales have been even higher than royalties. The milestone and bulk sales are added to the royalties when calculating revenue.

For 2021 as an example, Halo has guided to receive over $120 mil in milestones (see corporate presentation). Divide this by 4 to get an estimate of quarterly milestones. If maumar’s original prediction of $40 mil in royalties turn out correct and you add $30 mil for milestones, you are looking at $70 mil and this figure does not even include bulk sales. This alone translates to $0.5 revenue per share which easily beats your referenced seeking alpha consensus.

So don’t scare yourself too much by the “$0.28 revenue per share”. It is deeply misinformed.

[maumar]

As biotechinvestor1 pointed out, those estimates were for royalties only. According to yahoo finance, average revenue estimates are $84.88M. But obviously it's crucial that royalties keep going up. I am a little nervous. Not sure what expectations are, but I would think $35M or below will be disappointing. Also, with the XBI dropping from about $175 in February to below $125, it's concerning that the whole sector is so out of favor.