Exelixis, Inc. EXEL stock analysis, estimates, growth predictions.

Updated: Nov 17

Yesterday I alerted that I added EXEL stock to my portfolio. I intend to hold this stock for the next year or 2 as I very much like the current state of Exelixis, Inc. business and the pipeline of products in stage 3 FDA approval.


There are 14 analysts covering Exelixis, Inc. (EXEL stock). The growth in revenue and earnings are expected to slow down a bit in 2020, but starting 2021 the growth is expected to resume.

Source: https://simplywall.st/stocks/us/pharmaceuticals-biotech/nasdaq-exel/exelixis


With the growth in revenue Exelixis, Inc. is also expected to deliver the following EPS for EXEL stock for the next few years:

2020: $0.434

2021: $0.785 (+81%)

2022: $1.353 (+72%)

2023: $1.988 (+41%)

2024: $2.371 (+19%)

The current price for EXEL stock is $21.96 and it is trading at a PE of 23.45.

The average earnings growth for the next 5 years as shown above is 55%. This gives a Price-to-Earnings-Growth ratio of 23.45/55 = 0.43. Just to remind, PEG of 1 is considered to be good. Everything below 1 is great.


If we calculate the forward PE using the predicted EPS and the current price we will get the following scores for EXEL stock:

2021: 28

2022: 16

2023: 11

2024: 9


The average PE for US stocks currently stands at 19.1; US Biotechs industry average (24x).


So by the end of 2023, the stock price can easily double, but I think this will happen faster due to fast growth of earnings and low PEG, so we might see the price double by end of 2022. The timeframe for holding the stock may be a bit long for some to see the movement. I am OK to wait.


Analyst predictions for EXEL stock


Based on https://www.marketwatch.com/investing/stock/exel/analystestimates there are 15 analysts covering Exelixis, Inc. (EXEL) stock. 10 of them have 'BUY' rating, 5 - 'HOLD'. The average target price for Exelixis, Inc. (EXEL) stock is $30 which is 36% higher than the current price.



Exelixis, Inc. Q2 Earnings


On the most recent Earnings Release. the company reported earnings of 21 cents per share, a Consensus Estimate of 12 cents. The bottom-line figure, however, declined from the year-ago quarter’s 25 cents per share due to higher R&D expenses.

Net revenues came in at $259.5 million, increasing from the $240.3 million reported in the year-ago quarter. Revenues also beat Consensus Estimate of $233 million.



Exelixis, Inc. Pipeline Update


In April 2020,  Exelixis and Bristol-Myers BMY announced that CheckMate -9ER, the phase III study evaluating Opdivo in combination with Cabometyx compared to Sutent in previously untreated advanced or metastatic RCC, met its primary endpoint of progression-free survival at the final analysis as well as the secondary endpoints of overall survival at a pre-specified interim analysis and objective response rate. This preliminary analysis of data showed a favorable safety profile for the combination of a 40 mg dose of cabozantinib with Opdivo.


In June and July, Exelixis announced the initiation of CONTACT-01, CONTACT-02 and CONTACT-03, three global phase III studies of cabozantinib in combination with Roche’s RHHBY Tecentriq in patients with previously treated metastatic non-small cell lung cancer (NSCLC), castration-resistant prostate cancer (CRPC) and RCC, respectively.

Source: https://finance.yahoo.com/news/exelixis-exel-q2-earnings-revenues-143202038.html


The only likely reason why EXEL stock is not moving as much as we would have hoped is 2020 guidance. Revenues are now projected at $900-$950 million (previous guidance: $850-$900 million). While Exelixis, Inc. increased guidance numbers this guidance is still lower than 2019 revenues.


Check my portfolio performance, watch list, and list of past stock analysis here: https://www.wininstocks.com/watch-list-and-portfolio

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