) is set to report second quarter 2013 results on Apr 25, 2013.
Last quarter, the company reported in-line results for the first
quarter. Let's see how things are shaping up for this
Factors at Play
AmerisourceBergen, one of the world's largest pharmaceutical
services companies, has delivered positive earnings surprises in
two of the last four quarters with an average beat of 2.91%.
Revenues in the fourth quarter grew 5.7% year over year primarily
driven by the pharmaceutical distribution segment. Growth in the
last quarter was positively impacted by increase in third party
logistics, blood products, and vaccine and physician office
distribution business at AmerisourceBergen.
AmerisourceBergen struck a 10-year deal with
) in Mar 2013, which is expected to add approximately $2 billion
to top line in fiscal 2013. Meanwhile, in order to streamline its
operations, the company decided to sell its Canadian
pharmaceutical distribution business, which was facing tough
market conditions for generics. Additionally, AmerisourceBergen
also agreed to sell AndersonBrecon - its contract pharmaceutical
packaging business in the US and the UK. We are positive on
the recent divestitures along with the deal with Walgreens, which
we believe should positively impact results.
However, our proven model does not conclusively show that
AmerisourceBergen will beat earnings this quarter. That is
because a stock needs to have both a positive Earnings ESP (Read:
Zacks Earnings ESP: A Better Method
)) and a Zacks Rank #1, #2 or #3 to be able to beat consensus
estimates. That is not the case here as you will see below.
The ESP, which represents the difference between the Most
Accurate estimate and the Zacks Consensus Estimate, is 0.00%.
This is because both the Most Accurate Estimate and Zacks
Consensus Estimate currently stand at 88 cents.
Zacks Rank #3 (Hold):
AmerisourceBergen's Zacks Rank #3 (Hold) when combined with a
0.00% ESP makes surprise prediction difficult.
We caution against stocks with Zacks Ranks #4 and #5 (Sell-rated
stocks) going into the earnings announcement, especially when the
company is seeing negative estimate revisions momentum.
Other Stocks to Consider
Here are some other companies you may want to consider as our
model shows that they have the right combination of elements to
post an earnings beat this quarter:
Eli Lilly and Company
) Earnings ESP of +2.86% and a Zacks Rank #3.
) Earnings ESP of +0.80% and a Zacks Rank #3.
AMERISOURCEBRGN (ABC): Free Stock Analysis
LILLY ELI & CO (LLY): Free Stock Analysis
NOVARTIS AG-ADR (NVS): Free Stock Analysis
WALGREEN CO (WAG): Free Stock Analysis Report
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