C.R. Bard (BCR) to Report Q4 Earnings: A Surprise in Store?

Murray Hill, NJ-based CR Bard Inc.BCR is scheduled to report fourth-quarter 2016 earnings, after market close on Jan 26.

Last quarter, the company reported adjusted earnings of $2.64, exceeding the Zacks Consensus Estimate by 9 cents and also improving 15.8% from the year-ago quarter. Notably, adjusted earnings were better than management's guided range.

Meanwhile, the company's earnings topped the Zacks Consensus Estimate in all the last four quarters with an average beat of 4.07%. Delving deeper into the fundamentals of the stock, let's see how things are shaping up prior to this quarter.

C.R. Bard Inc. Price and EPS Surprise

C.R. Bard Inc. Price and EPS Surprise | C.R. Bard Inc. Quote

Factors at Play

We believe that the growing adoption of the company's flagship Lutonix drug coated-balloon (DCB) will continue to be the key growth catalyst for Bard in this quarter as well. In this regard, Lutonix DCB is used to treat patients suffering from peripheral arterial disease (PAD). In fact, within the Endovascular business, peripheral PTA line sales are solely driven by accelerating demand for the Lutonix drug-coated balloon (DCB) in the U.S. We expect to see this product to significantly contribute to the company's topline in the yet-to-be-reported quarter.

Furthermore, the company's investments in the emerging markets have strengthened its position internationally and are expected to deliver accretive returns in the quarter. We are also upbeat on the solid contribution from the company's vascular product line. The urology and oncology segments are also likely to drive sales in the quarter.

On the flip side, a challenging Med-tech environment, especially in the hernia fixation and peripheral stent businesses raises concerns. The company continues to witness significant pricing pressure as well. Also, unfavorable foreign currency will continue to hurt top-and bottom-line growth.

Furthermore, uncertainties associated with the possibilities of a repeal of the Affordable Care Act under President Trump add to our concerns.

Estimate Revision Trend

While the company's fundamentals remain more or less sound, the current quarter's estimate revision trend points to a different story. Over the past one month, three estimates moved south with none moving in the opposite direction. As a result, the current quarter estimates decreased almost 0.34% to $2.73, over the last 30 days.

Earnings Whispers

Our quantitative model doesn't point to an earnings beat either this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.

Zacks ESP : The Earnings ESP for Bard is 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate stand at $2.73. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter .

Zacks Rank : Bard carries a Zacks Rank #3 which increases the predictive power of ESP. However, the company's ESP of 0.00% makes surprise prediction difficult.

Meanwhile, we caution against stocks with a Zacks Ranks #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks to Consider

Here are some 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:

Cempra Inc. CEMP has an Earnings ESP of +15.79% and a Zacks Rank #2. You can see the complete list of today's Zacks #1 Rank stocks here .

Molina Healthcare Inc. MOH has an Earnings ESP of +5.33% and a Zacks Rank #2.

Universal Health Services, Inc. UHS has an Earnings ESP of +4.97% and a Zacks Rank #2.

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C.R. Bard Inc. (BCR): Free Stock Analysis Report

Cempra Inc. (CEMP): 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 Nasdaq, Inc.

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

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