Emergent BioSolutions, Inc.

Emergent BioSolutions, Inc. (EBS - Snapshot Report) is aggressively growing its earnings, recently reporting impressive third-quarter results that marked big gains from the previous year. Analysts are very bullish on the company, with the next-year estimate projecting 100% earnings growth.

Company Description

Emergent BioSolutions, Inc. is a bio-pharmaceutical company that develops and manufactures immunobiotics in the U.S., U.K. and Vietnam. The company operates in two divisions, biodefense and commercial, and has a market cap of $677 million.

Third-Quarter Results

Emergent BioSolutions reported excellent third-quarter results on Nov 6 that were far ahead of analyst estimates. Revenue came in at $56.6 million, a 30% increase from last year. Net income totaled $10.4 million, a big jump from income of $2.8 million last year. This produced earnings of 35 cents per share, blowing past analyst estimates of 17 cents.

The company said its solid showing was driven by sales of its anthrax vaccine BioThrax, which climbed 55% from last year to $55.5 million. The jump came mostly from a 34% increase in the average sales price per dose.

Debt and Liquidity

Emergent said that at the end of the quarter it had $104.7 million in cash and cash equivalents, providing the company with a financial cushion to buffer against economic and market volatility.

Guidance and Estimates

After the solid quarter, Emergent went ahead and boosted its earnings estimates. Net income is projected to fall between $21 and $25 million, with earnings projected between 70 and 83 cents.

The analyst community is bullish on the company as well, with the next-year estimate pegged at $1.46 per share, a 100% earnings growth projection.

The Chart

Shares of EBS have been on a nice rally since early October, bottoming out just above $11 and recently topping off just shy of $26. Moving forward, this company will need to produce robust earnings to support more share appreciation due to higher valuations. Take a look at the chart below.