Questcor Pharmaceuticals, Inc. (QCOR) has almost doubled in 2011, recently hitting a new multi-year high after reporting strong Q2 results that included a 17% earnings surprises. With a bullish growth projection and attractive valuation, this Zacks #1 Rank stock has plenty of momentum.
Company Description
Questcor Pharmaceuticals, Inc. is a pharmaceutical company that provides prescription drugs for the central nervous system and inflammatory diseases. The company was founded in 1990 and has a market cap of $1.67 billion.
Although QCOR has spent most of the last 9 months trending higher, shares got an extra boost on July 26 after the company reported strong Q2 results that came in ahead of expectations.
Second-Quarter Results
Revenue for the period was up 62% from last year to $46 million. Earnings also looked good, coming in at 21 cents, 17% ahead of the Zacks Consensus Estimate.
The company’s primary drug, H.P. Acthar, an injectable drug for inflammatory disorders, drove the strong results, with paid subscriptions for multiple sclerosis (MS) up 147% from last year. For the quarter, Questcor saw an overall increase in Acthar shipments for various conditions of 45%.
Financail Profile
Moving forward, the company will continue to benefit from its strong financial profile, with cash and short-term investments up $36 million to $129 million against no long-term debt.
Estimates
Although we didn’t see any movement in the current-year estimate off the good quarter, pegged at 88 cents, the next-year estimate added 22 cents to $1.35, a bullish 52% growth projection.
Valuation
But in spite of the gains, the valuation picture looks great, with a PEG ratio of .60, well below the traditional benchmark of 1 for value.
12-Month Chart
On the chart, shares recently hit a new multi-year high before pulling back with the market. Look for support from the long-term trend on any weakness. Take a look below.
Michael Vodicka is the Momentum Stock Strategist for Zacks.com. He is also the Editor in charge of the Zacks Momentum Trader Service.
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