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What's in Store for Becton, Dickinson's (BDX) Q4 Earnings?

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Becton, Dickinson and Company (BDX - Free Report) , popularly known as BD, is scheduled to release fourth-quarter fiscal 2020 results on Nov 5, before the opening bell.

BD delivered an earnings surprise of 7.3% in the last reported quarter. It beat estimates in each of the trailing four quarters, the average surprise being 5.1%.

Q4 Estimates

For the quarter to be reported, the Zacks Consensus Estimate for adjusted earnings per share (EPS) is pegged at $2.50, suggesting a decline of 24.5% from the prior-year quarter. The same for revenues stands at 4.48 billion, indicating a decrease of 2.2% from the year-ago reported figure.

BD Life Sciences: A Key Catalyst

BD Life Sciences’ fiscal fourth-quarter performance is likely to reflect strong year-over-year growth in revenues from assays, which are used to detect a broad range of infectious diseases, healthcare-associated infections and cancer.

Notably, strong performance by the Diagnostic Systems and Biosciences sub-units may have contributed to the to-be-reported quarter’s performance.
In fact, the Zacks Consensus Estimate for fiscal fourth-quarter revenues for this segment is pegged at $1.23 billion, suggesting growth of 8.6% from the year-ago reported figure.

In July, BD received the Emergency Use Authorization (EUA) from the FDA for a rapid, point-of-care, SARS-CoV-2 diagnostic test for use with its widely available BD Veritor Plus System, which marked the company’s third diagnostic test to receive EUA for the detection of COVID-19. Also, in the same month, BD launched BD PurPrep patient preoperative skin preparation with sterile solution — the first and only fully sterile povidone-iodine plus isopropyl alcohol single-use antiseptic skin preparation commercially available in the United States.

These developments might get reflected in the fiscal fourth-quarter results.

Further, during the fiscal second quarter, BD closed the acquisition of NAT Diagnostics, an early-stage company with a very innovative platform in the fast-growing molecular point-of-care market. This buyout will strengthen the company’s presence in the molecular point-of-care testing market. This acquisition may have favored the fiscal fourth-quarter performance.

Other Factors to Note

Weak performance by the BD Interventional arm might get reflected in the company’s fiscal fourth-quarter results owing to sluggish performance across Surgery and Peripheral Intervention units.

Nonetheless, robust product pipeline is likely to have contributed to the fiscal fourth-quarter performance.

However, the company anticipates fiscal fourth-quarter results to reflect the impact of foreign exchange headwinds.

Also, the company is likely to have witnessed fall in revenues at its BD Medical segment in the to-be-reported quarter primarily due to weakness in Medication Delivery Solutions unit.

Nonetheless, the company is likely to see revenue growth in Medication Management Solutions unit on the back of solid demand for infusion pumps in the United States under medical necessity and strong growth outside the United States, particularly in Europe.

What the Zacks Model Unveils

Per our proven model, a combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here as you will see below.

Earnings ESP: BD has an Earnings ESP of +1.07%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: The company carries a Zacks Rank #4 (Sell).

Stocks Worth a Look

Here are some medical stocks worth considering as these have the right combination of elements to post an earnings beat this quarter.

Zimmer Biomet Holdings, Inc. (ZBH - Free Report) has an Earnings ESP of +4.10% and a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Canopy Growth Corporation (CGC - Free Report) has an Earnings ESP of +7.55% and a Zacks Rank of 3.

Orthofix Medical Inc. (OFIX - Free Report) has an Earnings ESP of +42.86% and a Zacks Rank of 3.

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