On Sep 25, we have reiterated our Neutral recommendation on
Becton, Dickinson and Company
). We are encouraged by the company's earnings and revenues beats
in the fiscal-2013 third quarter and reiteration of earnings and
revenues guidance for fiscal 2013. However, we are concerned
about challenging conditions in demand for healthcare products,
higher raw material costs and other macroeconomic headwinds faced
by the company.
ALPHATEC HLDGS (ATEC): Free Stock Analysis
BECTON DICKINSO (BDX): Free Stock Analysis
CARDINAL HEALTH (CAH): Free Stock Analysis
STRAUMANN (SAUHF): Get Free Report
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On Aug 1, Becton, Dickinson and Company reported third quarter
fiscal 2013 adjusted earnings per share of $1.54, beating the
Zacks Consensus Estimate of $1.47 per share and up 1.3% year over
year. Revenues were $2,052.7 million, up 3.6% (up 5.1% in
constant currency) year over year and marginally ahead of the
Zacks Consensus Estimate of $2,050 million.
BDX reiterated its guidance for fiscal 2013. The company expects
sales growth for fiscal 2013 in the range of 3.5% to 4% (growth
of 5.0% at CER) compared with 4.5% to 5.0% earlier). The company
continues to expect reported earnings per share from continuing
operations for fiscal 2013 in a band of $5.72−$5.75. The
projection implies a year-over-year growth of 6.5%−7.0%
(8.5%−9.0% at CER) or 11.0%−11.5% after accounting for the
medical device tax implemented in Jan 2013.
Following the release of fiscal-third quarter results, the Zacks
Consensus Estimate for 2013 earnings remained the same at $5.75
per share. The Zacks Consensus Estimate for 2014 earnings also
remained unchanged at $6.26 per share. With the Zacks Consensus
Estimates remaining unchanged, BDX retains a Zacks Rank #3
BD is pursuing a number of key product initiatives. During fiscal
2013, it plans to commercialize over ten new offerings. Further,
the company continued to focus on geographical expansion into
overseas markets, in particular, emerging markets, which account
for about 23% of sales.
However, BDX continues to be challenged by downward pressure on
demand for health care products as hospital and lab-testing
expenditure remain areas of concern and high unemployment rates
in the U.S. have dampened requirement for doctors' visits. These
apart, strong competition and higher costs of raw materials pose
threat to the company.
Other Stocks to Look For
Other stocks that are currently performing well in the medical
instruments industry include
STRAUMANN HLD N AKT
) with a Zacks Rank #1 (Strong Buy), and
Alphatec Holdings, Inc.
Cardinal Health, Inc.
), both with a Zacks Rank #2 (Buy).