Express Scripts, Inc.

Express Scripts, Inc. (ESRX - Analyst Report) reported great quarterly results and have demonstrated benefits from the economic downturn over the past few months and into the future. Estimates are climbing as the company approaches its next earnings announcement.

Company Description

Express Scripts, Inc. is one of the largest pharmacy benefit management companies in North America. Through facilities in the U.S. and Canada, the company serves thousands of client groups, including managed care organizations, insurance carriers, third-party administrators, employers and union-sponsored benefit plans.

The company is headquartered in St. Louis, has almost 12,000 employees, and carries a market cap of $14 billion.

33% Jump in Earnings

When Express Scripts reported its third-quarter results on Oct 30, earnings per share were up 33%, year-over-year. Net income was $203 million, which yielded 81 cents per share, up from 61 cents.

Estimates Rising Following Surprise

Wall Street was only expecting earnings of 78 cents per share, making it the fourth surprise in the past 4 quarters.

The consensus estimate has been climbing slowly over the past few months. Estimates are now averaging $3.69 per share, which is toward the top of the company's guidance and up 5 cents over the past 90 days.

Growth rates are now 30% for 2008 and 19% for 2009.

Benefits of a Recession

In the third-quarter announcement, George Paz, president and CEO, said "In the current economic environment, plan sponsors need us more than ever to help lower their pharmacy spend."

He continued "As our consumer strategy initiative continues to gain traction in the marketplace, we are demonstrating success in driving to lowest net cost, increasing member engagement and enabling better health and value."

The Chart

Shares of ESRX are developing a nice trend but continue to encounter resistance near $61. If the trend can continue through that level the stock could see a nice run. Take a look at the chart below.

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