Vaccine Awards Propelling Akorn (AKRX)
Akorn, Inc. (NASDAQ: AKRX) has made a statement that has interesting financial ramifications for the company. That is even more so since the small biotech is largely under-followed by Wall Street.
Akorn has announced that its Q2-2008 net sales will exceed consensus estimates by about 15%. The company said that the revenue increases are a direct result of strength in its core business, primarily in vaccines.
It has also announced a contract award from the Centers for Disease Control and Prevention for Tetanus Diphtheria Vaccines. The contract award includes the multi dose Td Vaccine and the unit dose preservative free Td Vaccine. This award is effective July 1, 2008 for a period of twelve months.
What makes this interesting isn’t just the size of the awards nor the size of the company. Akorn has been public forever and 2008 has been an ugly chart year for the stock. The past years have shown to be very sporadic revenues with fiscal losses in each of the last 3 years. But the 2008 to 2009 period is supposed to be the transitional period for the company. It is expected to have a slight loss for 2008 but 2009 is expected to be its first real profitable year as revenues are expected to grow substantially.
Shares are only up 1% or 2% today after the news. This fits all the profiles for our weekly “10 Stocks Under $10″ newsletter over at 247WallSt.com. This looks like it is being largely overlooked, although we would look at the company’s balance sheet with at least a little more caution in case any hiccups come into play.
Jon C. Ogg
June 30, 2008