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Protagonist Therapeutics (PTGX) Soars 51.9%: Is Further Upside Left in the Stock?

Protagonist Therapeutics PTGX shares soared 51.9% in the last trading session to close at $23.09. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 1.6% gain over the past four weeks.

The company recently reported positive top line results from FRONTIER 1 study of the oral IL-23 receptor antagonist JNJ-2113 (PN-235) in psoriasis in collaboration with Janssen Biotech, Inc., one of the Janssen Pharmaceutical Companies of Johnson & Johnson. Protagonist expects that JNJ-2113 will progress into a phase III registrational study in plaque psoriasis on the strength of these data.

If JNJ-2113 advances into a phase III study and the study meets its primary goal, Protagonist will get milestone payments of $50 million and $115 million, respectively. In total, Protagonist remains eligible for up to $855 million in various milestone payments and tiered royalties based on worldwide net drug sales. Investors are most likely upbeat about the same.

 

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This biopharmaceutical company is expected to post quarterly loss of $0.71 per share in its upcoming report, which represents a year-over-year change of +7.8%. Revenues are expected to be $10 million, up 16% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For Protagonist Therapeutics, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on PTGX going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Protagonist Therapeutics belongs to the Zacks Medical - Biomedical and Genetics industry. Another stock from the same industry, GSK (GSK), closed the last trading session 1.2% lower at $34.03. Over the past month, GSK has returned -2.5%.

For Glaxo , the consensus EPS estimate for the upcoming report has changed -5.6% over the past month to $0.85. This represents a change of -22.7% from what the company reported a year ago. Glaxo currently has a Zacks Rank of #3 (Hold).

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