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The Zacks Analyst Blog Highlights: Eli Lilly, Valeant Pharmaceuticals International, Biogen and Medicines Company - Press Releases

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For Immediate Release

Chicago, IL - July 15, 2015 - Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include the Eli Lilly and Company ( LLY ), Valeant Pharmaceuticals International, Inc. ( VRX ), Biogen ( BIIB ) and Medicines Company ( MDCO ).

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Here are highlights from Tuesday's Analyst Blog:

4 Health Care Stocks to Check Out This Earnings Season

Health care companies have been attracting a lot of attention with big players resorting to mergers and acquisitions and licensing deals to bolster their beleaguered pipelines. The sector has been witnessing a flurry of mergers and acquisitions over the past few quarters, and these deals show no signs of slowing down.

Several health care companies are also entering into licensing deals to augment their pipeline. Immuno-oncology continues to be one of the favorite therapeutic areas in this regard. In the last couple of months, we saw a number of deals in which large cap health care companies have shown interest in developing immuno-oncology therapies.

Thus, it may be a good idea to look at some of these companies in the health care sector that have the potential to beat earnings in their upcoming releases. These stocks are well positioned in today's market environment, and could see considerable upside riding on the aforementioned trends. An earnings beat should help these stocks gain investor confidence and show a favorable price movement.

How to Pick?

Given a large number of industry participants, pinpointing stocks that have the potential to beat estimates could appear to be a daunting task. But our proprietary methodology makes it fairly simple. One way to narrow down the list of choices this earnings season is by looking at stocks that have the combination of a favorable Zacks Rank - Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) - and a positive Zacks Earnings ESP .

Earnings ESP is our proprietary methodology for identifying stocks that have high chances of surprising in their next earnings announcement. It shows the percentage difference between the Most Accurate estimate and the Zacks Consensus Estimate.

Our research shows that for stocks with this combination, the chance of a positive earnings surprise is as high as 70%.

Below are four health care stocks we believe are best positioned to stand out this earnings season.

Eli Lilly and Company ( LLY ) is a Zacks Rank #3 stock with an Earnings ESP of +1.33%. The Zacks Consensus Estimate for the second quarter of 2015 is 75 cents. The company has registered positive earnings surprises in three of the last four quarters with an average beat of 4.71%.

The Indianapolis, IN based global health care company has core products in a number of primary-care pharmaceutical markets. Although the company's top line continues to remain under pressure due to generic competition and negative currency fluctuation, several products including Cyramza and Humalog should aid revenues. Moreover, Animal Health segment revenues should benefit from the acquisition of Novartis' ( NVS ) animal health business earlier this year.

-Eli Lilly will announce results on Jul 23.

Valeant Pharmaceuticals International, Inc. ( VRX ) is a Zacks Rank #3 stock with an Earnings ESP of +1.22%. The Zacks Consensus Estimate for the second quarter of 2015 is $2.46. The company has registered positive earnings surprises in three of the last four quarters with an average beat of 80.38%.

Based in Laval, Canada, Valeant is a specialty pharmaceutical and medical device company. Valeant has been very active on the acquisition front, which led to its solid growth. In Apr 2015, Valeant acquired Salix in a bid to enter the lucrative gastrointestinal disease market.

- Valeant will announce results on Jul 23.

Biogen ( BIIB ), based in Cambridge, MA, is a global biopharmaceutical company focused on developing and commercializing therapies for neurological, autoimmune and hematologic disorders. The stock carries a Zacks Rank #3, with an Earnings ESP of +0.25%. The Zacks Consensus Estimate for the to-be-reported quarter is $4.07.

Biogen has a pretty good earnings track record with the company delivering positive earnings surprises in each of the last three quarters with an average surprise of 12.28% in the last four quarters. New products like Plegridy, Eloctate and Alprolix should perform well.

- Biogen is set to report results on Jul 24.

The Medicines Company ( MDCO ) is a Zacks Rank #2 (Buy) stock with an Earnings ESP of +125%. The Zacks Consensus Estimate for second quarter 2015 is a loss of 20 cents. The company has registered positive earnings surprises in all the last four quarters with an average beat of 206.11%.

The Parsippany, NJ-based biopharmaceutical company is focused on advancing the treatment of critical care patients through the delivery of innovative, cost-effective medicines to the worldwide hospital marketplace. The company expects key drug, Angiomax sales to decline in the second quarter. However, launch of newer products should partially offset the loss.

- The Medicines Co. will announce results on Jul 29.

Bottom Line

While challenges in the form of increasing competition and pricing pressure remain in the sector, a number of health care companies are seeing an improvement in their financial results. With an aging population and an increasing demand for health care, the horizon looks great for the sector on the whole. Therefore, you should watch out for health care stocks with rising estimates, high growth projections and fair valuations. A sneak peek at the space for some outperformers, backed by a solid Zacks Rank and a positive Zacks Earnings ESP, could be a great idea for investors to gain from this earnings season.

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Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

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LILLY ELI & CO (LLY): Free Stock Analysis Report

VALEANT PHARMA (VRX): Free Stock Analysis Report

BIOGEN INC (BIIB): Free Stock Analysis Report

MEDICINES CO (MDCO): 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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