Estimates for Becton, Dickinson and Company ( BDX - Analyst Report ) are on a downswing following the first-quarter fiscal 2012 results, which appears to reflect its lower year-over-year earnings in the quarter due to higher raw material prices, tough pricing comparisons and rising expenditures for recent acquisitions.

The Results in Brief

Net income (as reported) for the first quarter dropped 16.8% year over year to roughly $263 million (or $1.21 a share). Becton Dickinson recorded revenues of $1,888 million in the reported quarter, up 2.5% (or 2.4% in constant currency) year over year.

Domestic sales for the quarter were $829 million, flat year over year. Ex-U.S. revenues were $1,059 million, up 4.5% (or 4.4% in constant currency). International sales were driven by sustained growth in emerging nations and robust safety sales.

We have discussed the quarterly results at length here: Becton Beats, Profit Drops

Agreement – Estimate Revisions

The overall trend in estimate revisions for fiscal 2012 is overwhelmingly negative following the release of the first quarter results. Out of 17 analysts covering the stock, 15 have lowered their estimates over the past month with no case of upward revision. There was only one estimate revision, in the upward direction, over the past 7 days.

A similar trend was seen for fiscal 2012 with 12 analysts (out of 17) lowering their forecast over the last 30 days with only two upward revisions. There was just a solitary positive revision, over the past 7 days, with no reverse movement.

Besides the year over year decline in earnings in the reported quarter, the bearish analyst sentiment also appears to reflect the company’s guidance revision. Becton Dickinson lowered its diluted earnings per share (from continuing operations) guidance for fiscal 2012 to a lower range of $5.60 to $5.70 (earlier $5.75 to $5.85), factoring in a stronger dollar.

Magnitude – Consensus Estimate Trend

A predominantly downward directional movement has led to a decrease in the annual forecast for Becton Dickinson. Estimates for fiscal 2012 and 2013 have gone down by 12 cents and 18 cents, respectively, over the last 30 days. The magnitude of revisions reached a plateau over the past week, in both cases. The current Zacks Consensus Estimate for 2012 is $5.67, reflecting an estimated 0.9% year-over-year growth.

Becton Dickinson Stays at Neutral

We remain cautious about Becton Dickinson due to the lack of major short-term catalysts. The rising demand for safety-needle products (with higher price points and margins) was the primary driver of the company’s past growth, which is not expected to continue, given that the U.S. market is already largely penetrated.

On the positive side, Becton Dickinson’s preeminent global healthcare products franchise is partly insulated from volatile macroeconomic conditions and structural deficiencies elsewhere in the healthcare delivery field.

Becton Dickinson faces a wide range of competitors, including Baxter International ( BAX - Analyst Report ) in certain niches, in each of its three business segments. Our Neutral recommendation is supported by a short-term Zacks #3 Rank (Hold).

About Earnings Estimate Scorecard

As a PhD from MIT, Len Zacks proved over 30 years ago that earnings estimate revisions are the most powerful force impacting stock prices. He turned this ground breaking discovery into two of the most celebrating stock rating systems in use today. The Zacks Rank for stock trading in a 1 to 3 month time horizon and the Zacks Recommendation for long-term investing (6+ months). These “Earnings Estimate Scorecard” articles help analyze the important aspects of estimate revisions for each stock after their quarterly earnings announcements. Learn more about earnings estimates and our proven stock ratings at http://www.zacks.com/education/