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Perrigo Stock Up as Appeal Date for Irish Tax Bill Nears
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Shares of Perrigo Company plc (PRGO - Free Report) rallied 11.5% on Dec 26 as the deadline to appeal against the tax bill of $1.9 billion from Ireland government approaches. Investors’ sentiment was positive and they expect Perrigo to remain committed to its statement about filing an appeal with the Irish revenue department.
Last week, Perrigo received a notice from the Irish government which held Elan Pharma, a subsidiary of Perrigo, liable to pay the said tax amount related to its sale of Tysabri intellectual property and related assets to Biogen (BIIB - Free Report) in 2013. Elan was eligible to receive an upfront payment and future contingent payments from Biogen, which were recognized as trading income, attracting a tax rate of 12.5%.
However, the Irish revenue department stated in the notice that the sale related to Tysabri should be considered as chargeable gains subject to a higher tax rate of 33%. This led to a massive tax bill for Perrigo.
The company’s stock had plunged nearly 30% last week, following the announcement of the tax bill notice in a SEC filing.
Perrigo’s shares are down 53.3% so far this year compared with the industry’s decline of 11.5%.
In its SEC filing, the company stated that it is on track to file an appeal and expects the proceedings to continue over a period of a few years before completion. Moreover, per the filing, no payment related to tax bill is required until all proceedings are complete.
Perrigo strongly disagreed with the assessment by the Irish revenue department, which neither provided a detailed clarification nor furnished additional documents in support of the bill.
Haemonetics’ earnings per share estimates have moved up from $2.28 to $2.33 for 2018 and from $2.96 to $3.04 for 2019 over the past 60 days. The company delivered positive earnings surprise in three of the trailing four quarters with the average beat being 21.27%.
AtriCure’s loss estimates have narrowed from 88 cents per share to 87 cents per share for 2018 and from 64 cents to 56 cents for 2019 over the past 60 days. The company delivered a positive earnings surprise in two of the trailing four quarters with the average beat being 11.81%.
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Perrigo Stock Up as Appeal Date for Irish Tax Bill Nears
Shares of Perrigo Company plc (PRGO - Free Report) rallied 11.5% on Dec 26 as the deadline to appeal against the tax bill of $1.9 billion from Ireland government approaches. Investors’ sentiment was positive and they expect Perrigo to remain committed to its statement about filing an appeal with the Irish revenue department.
Last week, Perrigo received a notice from the Irish government which held Elan Pharma, a subsidiary of Perrigo, liable to pay the said tax amount related to its sale of Tysabri intellectual property and related assets to Biogen (BIIB - Free Report) in 2013. Elan was eligible to receive an upfront payment and future contingent payments from Biogen, which were recognized as trading income, attracting a tax rate of 12.5%.
However, the Irish revenue department stated in the notice that the sale related to Tysabri should be considered as chargeable gains subject to a higher tax rate of 33%. This led to a massive tax bill for Perrigo.
The company’s stock had plunged nearly 30% last week, following the announcement of the tax bill notice in a SEC filing.
Perrigo’s shares are down 53.3% so far this year compared with the industry’s decline of 11.5%.
In its SEC filing, the company stated that it is on track to file an appeal and expects the proceedings to continue over a period of a few years before completion. Moreover, per the filing, no payment related to tax bill is required until all proceedings are complete.
Perrigo strongly disagreed with the assessment by the Irish revenue department, which neither provided a detailed clarification nor furnished additional documents in support of the bill.
Perrigo Company plc Price
Perrigo Company plc Price | Perrigo Company plc Quote
Zacks Ranks & Stocks to Consider
Perrigo is a Zacks Rank #5 (Strong Sell) stock.
Some better-ranked stocks from the pharma space are Haemonetics Corporation (HAE - Free Report) and AtriCure, Inc. (ATRC - Free Report) . Both the stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Haemonetics’ earnings per share estimates have moved up from $2.28 to $2.33 for 2018 and from $2.96 to $3.04 for 2019 over the past 60 days. The company delivered positive earnings surprise in three of the trailing four quarters with the average beat being 21.27%.
AtriCure’s loss estimates have narrowed from 88 cents per share to 87 cents per share for 2018 and from 64 cents to 56 cents for 2019 over the past 60 days. The company delivered a positive earnings surprise in two of the trailing four quarters with the average beat being 11.81%.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>