Actavis Discusses Preliminary Q4 Results - Analyst Blog

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Actavis ( ACT ) announced that it expects fourth quarter 2013 adjusted earnings to be slightly above the higher end of its previously guided range of $2.95 - $3.05 per share. The company's updated guidance is based on a preliminary review of 2013 results. In the fourth quarter of 2012, the company had reported adjusted earnings of $1.59 per share.

The fourth quarter 2013 earnings include the effect of the Oct 2013 Warner Chilcott acqusition. The Zacks Consensus Estimate currently stands at $3.02, well below the company's new guidance. We expect to see significant upward revisions in earnings estimates for the fourth quarter and full year 2013.

2013 Snapshot

In 2013, Actavis acquired Warner Chilcott, resulting in the creation of a leading global specialty pharmaceutical company with combined annual revenues of about $11 billion. Additionally, revenues were boosted by the inclusion of legacy Actavis revenues.

Actavis Pharma continued to witness robust growth driven by new product launches including the generic versions of Suboxone, Lidoderm and Cymbalta. Actavis Specialty Brands revenues were also strong reflecting the completion of the first phase of Warner Chilcott integration process and restructuring initiatives.

Higher chain customer sales and third-party brand products drove the Anda Distribution segment. Overall, we are pleased to see how well the year turned out to be.

Outlook for 2014

In its third quarter 2013 earnings press release, Actavis had provided a preliminary outlook for 2014. Actavis expects earnings of $12.25-$13.00 per share in 2014. The Zacks Consensus Estimate of $12.92 is towards the higher end of the company's guidance range.

We believe Actavis Pharma will continue to exhibit impressive growth rates in 2014 driven by the potential approval and launch of generic versions of Loestrin 24 (2014), OxyContin (2014), Exalgo - 32 mg (May 2014) and Intuniv (Dec 2014) among others.

Meanwhile, Actavis has been expanding its branded pharmaceutical business. With fewer major patent expiries slated to occur in the next few years, we are encouraged by Actavis' focus on building its branded and biosimilars pipeline. We view the company's latest acquisitions (Actavis Group and Warner Chilcott) as positive moves.

With preliminary results on the table, we believe all eyes will now be focused on the upcoming Investor Day (Jan 31) and the release of final fourth quarter and full year 2013 results (Feb 20).

Actavis currently carries a Zacks Rank #2 (Buy). Some better-ranked stocks include Impax Laboratories Inc. ( IPXL ), Actelion Ltd. ( ALIOF ) and Medivation, Inc. ( MDVN ). All three carry a Zacks Rank #1 (Strong Buy).



ACTAVIS PLC (ACT): Free Stock Analysis Report

ACTELION LTD (ALIOF): Get Free Report

IMPAX LABORATRS (IPXL): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Stocks

Referenced Stocks: ACT , ALIOF , IPXL , MDVN

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