Credit: Shutterstock photoHeadwinds slugged Pfizer 's ( PFE ) Essential Health unit in the third quarter, leading the Dow component to report soft revenue and shares to dip to a seven-week low early Tuesday.
[ibd-display-video id=2469617 width=50 float=left autostart=true]Chief Executive Ian Read outlined the continued struggles facing Essential Health in a statement to investors. The unit posted a 12% yearly decline to $5.05 billion. It comprised 38% of Pfizer's total sales.
"While Essential Health revenues remained challenged primarily due to continued headwinds from products that recently lost marketing exclusivity and product supply, we had solid operational growth in emerging markets and biosimilars," he said.
In midday trading on the stock market today , Pfizer fell 0.6%, near 34.90, after earlier diving nearly 3% to a low last seen in mid-September. Meanwhile, the broader drug-stock group lifted 0.6%.
For the third quarter, Pfizer reported adjusted profit of 67 cents, rising 10% and beating expectations by 2 cents. Sales of $13.168 billion edged up roughly 1%, but were just below analyst views for $13.169 billion.
IBD'S TAKE:Pfizer has an IBD Composite Rating of 62 out of a best-possible 99, meaning it outperforms more than six in 10 stocks in terms of key growth metrics. But it still lags leaders like AbbVie, which has a CR of 95. Head to IBD Stock Checkup for a look at the drug group's top performers.
Innovative Health grew 11% to $8.12 billion. The business includes newer drugs that tend to yield higher sales for the company, including vaccines and those that treat cancer. Essential Health includes older, established pharmaceuticals.
Consumer Healthcare sales of $829 million grew 4% and were in line with expectations, Leerink analyst Seamus Fernandez said in a note to clients. Earlier this month, Pfizer said it's reviewing strategic options for that business, including selling it or a spinning it off.
Pfizer noted its year-over-year growth suffered by 2%, or $281 million, due to the February divestiture of Hospira Infusion Systems. Excluding the impact of that divestiture, total sales would have grown 3%. Essential Health would have declined 7%.
The firm also raised the midpoint of its adjusted earnings guidance by 3 cents to $2.58-$2.62 per share. Analysts had called for $2.56. It also narrowed its full-year sales outlook to $52.4 billion to $53.1 billion, from $52 billion to $54 billion, previously.
Pfizer, which is in IBD's Dividend Leaders screen, pays a quarterly dividend of 32 cents a share. That represents an annualized yield of 3.7%.
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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.
