Merck & Co. Inc.
) is scheduled to report its fourth quarter 2012 results on Feb
1, 2013 before the opening bell.
Last quarter, the company posted a 2.15% positive surprise.
Let's see how things are shaping up prior to the
Growth Factors in the Third Quarter of 2012
Merck reported third quarter 2012 earnings per share
(excluding special items) of 95 cents, a couple of cents ahead of
the Zacks Consensus Estimate and 1.1% above the year-ago
earnings. Though revenues declined 4.4% year over year, earnings
benefited from cost control and a lower tax rate.
Even though headwinds, such as genericization of
Singulair, EU pricing pressure, unfavorable currency movement, US
health care reform, the Remicade/Simponi transition and pipeline
setbacks are expected to continue to hurt Merck, some of the
company's recent launches should start contributing significantly
to the top line in the forthcoming quarters.
Our proven model does not conclusively show that Merck is
likely to beat earnings this quarter. This is because a stock
needs to have both a positive Earnings ESP (Read:
Zacks Earnings ESP: A Better Method
) and a Zacks Rank #1 (Strong Buy) or at least Zacks Rank #2
(Buy) or Zacks Rank #3 (Hold) for this to happen. This is not the
case here as you will see below.
The Most Accurate estimate stands at 81 cents. It is in line with
the Zacks Consensus Estimate. This implies an earnings ESP of
Zacks Rank #3 (Hold):
Merck carries a Zacks Rank of 3. The combination of Merck's Zacks
Rank #3 and 0.00% ESP makes a surprise prediction difficult.
Other Stocks to Consider
Here are some other companies you may want to consider as our
model shows they have the right combination of elements to post
an earnings beat this quarter:
has earnings ESP of +9.21% and carries a Zacks Rank #2 (Buy).
) has earnings ESP of +4.69% and carries a Zacks Rank #2 (Buy).
) has earnings ESP of +3.92% and carries a Zacks Rank #3
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