Endo Pharmaceuticals (ENDP) has been white-hot over the past few months. In late May we suggested the company’s key drug could make ENDP a four-bagger. The stock has up over 2.5 times since that report was released. Endo’s Q2 2018 financial results proved there was real meat on the bone outside of its “key drug.”
Revenue from Sterile Injectables was up 21% Y/Y, while Xiaflex (included in Specialty Products) was up 27%. Sterile Injectables and Xiaflex represent a combined 39% of total Q2 2018 revenues, up from 26% in the year earlier period. These two drugs could be the moat ENDP longs are looking for to offset the loss of revenue from pain-related drugs and the continued diminution in generics. Gross margin improvement and cost takeouts helped improve EBITDA margins. That said, the stock recently got a boost from potential FDA restrictions on compounding for Vasopressin.
Tuesday management is presenting at the B. Riley FBR Healthcare Conference. According to Shocking The Street, positive comments on recent distribution deals and updates on a “key drug” could cause ENDP to spike. Read more: