Perrigo Company plc PRGO reported adjusted earnings of 53 cents per share in the second quarter of 2024, beating the Zacks Consensus Estimate of 48 cents. Earnings were down 15.9% year over year due to discrete tax benefits of nine cents per share in the year-ago period and a negative financial impact of 14 cents from infant formula.
Net sales declined 10.7% year over year to $1.07 billion, missing the Zacks Consensus Estimate of $1.13 billion. The downside was due to lower net sales of infant formula and lower net sales across the Upper Respiratory and Pain & Sleep Aids categories.
During the quarter, sales dropped 0.6% on account of exited product lines and 0.9% due to unfavorable currency movement. At constant currency (excluding foreign currency translation), sales fell 9.8%. Organic net sales (excluding the effects of acquisitions and divestitures and the impact of currency) were down 9.1% year over year.
Segment Discussion
Perrigo reports its results under the following segments — Consumer Self Care Americas (CSCA) and Consumer Self Care International (CSCI).
CSCA: The segment’s net sales in the second quarter of 2024 came in at $634 million, down 15.5% year over year. The downside was due to lower net sales of infant formula and lower net sales across the Upper Respiratory and Pain & Sleep Aids categories. Organic net sales fell 15.1%.
CSCI: The segment reported net sales of $431 million, down 2.5% from the year-ago period’s levels, due to product line exits and unfavorable currency movements. This fall was partially offset by growth in the Skin Care and Women's Health categories, strategic pricing actions and new products. At constant-currency rates, sales were down 0.1% year over year. Organically, sales increased 1.0%.
2024 Guidance
Perrigo revised its guidance for sales. Management now expects total net sales growth to decline 3-5% year over year, compared to the previously issued flat year-over-year guidance. Per management, this downward revision was primarily due to lower seasonal demand experienced in the first half of 2024 and expected lower distribution in U.S. store brand in the second half of 2024. Shares fell 3% in pre-market trading on Aug 2, likely due to this cut.
Year to date, shares of Perrigo have lost 12.5% against the industry’s 5.6 % growth.
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Management reiterated the rest of its financial guidance. Adjusted earnings per share (EPS) are expected to be between $2.50 and $2.65. The adjusted tax rate is expected to be around 20.5%. Perrigo expects to record interest expenses of about $180 million.
Perrigo Company plc Price
Perrigo Company plc price | Perrigo Company plc Quote
Zacks Rank & Key Picks
Perrigo currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the healthcare sector are Entrada Therapeutics TRDA, Immatics IMTX and Halozyme Therapeutics HALO, each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
In the past 60 days, estimates for Entrada Therapeutics’ 2024 loss per share have improved from 14 cents to 13 cents. Estimates for 2025 have improved from $3.44 to $3.21 during the same period. Year to date, shares of Entrada Therapeuticshave risen 5.8%.
Earnings of Entrada Therapeutics beat estimates in two of the last four quarters while missing the mark on two other occasions. Entrada delivered a four-quarter average earnings surprise of 42.18%.
In the past 60 days, the loss per share estimates for Immatics have improved from $1.26 to $1.25 for 2024. During the same period, loss estimates for 2025 have improved from $1.49 to $1.41. Year to date, shares of IMTX have risen 12.2%.
Earnings of Immatics beat estimates in three of the last four quarters while meeting the mark on one occasion, delivering a four-quarter average earnings surprise of 32.57%.
In the past 60 days, the Zacks Consensus Estimate for Halozyme Therapeutics’ 2024 earnings has risen from $3.69 per share to $3.90. For 2025, earnings estimates have increased from $4.50 to $4.81 in the past 60 days. Year to date, shares of HALO have surged 48.9%.
Earnings of Halozyme beat estimates in three of the last four quarters while meeting the mark on one occasion, delivering a four-quarter average earnings surprise of 9.40%.
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