Back to top

Analyst Blog

Express Scripts Holding Company’s (ESRX - Analyst Report) fourth quarter 2012 adjusted earnings of $1.05 per share were in-line with the Zacks Consensus Estimate, and increased 28.1% from the year-ago period. Higher revenues aided earnings in the fourth quarter of 2012.

On a reported basis (including special items), earnings grew 5.1% to 62 cents in the fourth quarter of 2012.

For 2012, revenues came in at $93.8 billion, up 103.4% from 2011, and beat the Zacks Consensus Estimate of $92.8 billion. Adjusted earnings in 2012 came in $3.74, up 25.9% from 2011 and ahead of the Zacks Consensus Estimate of $3.72.

Quarter in Detail

Revenues jumped 126.5% in the reported quarter to $27.4 billion. The massive jump was attributable to the expanded product portfolio at Express Scripts due to the acquisition of Medco Health Solutions in 2011. Revenues were roughly in line with the Zacks Consensus Estimate.

Adjusted gross profit jumped 160.0% to $2.3 billion in the reported quarter. Gross profit was boosted by the inclusion of results of the erstwhile Medco Health Solutions, which led to improved operating performance, increased generic utilization and realization of synergies. Adjusted selling, general and administrative expenses climbed 263.9% to $784.5 million.

Total adjusted claims at Express Scripts for the reported quarter came in at 410.8 million, up 111%.

Cash flow from operations came in at $2.6 billion, significantly up from $0.5 billion in the fourth quarter of 2011.

2013 Earnings Outlook

We note that Express Scripts successfully integrated operations of erstwhile Medco Health Solutions in 2012. Express Scripts expects adjusted earnings for 2013 in the range of $4.20–$4.30 per share, up 12% – 15% over 2012.

The pre-earnings Zacks Consensus Estimate stands at $4.19. Adjusted claims are expected to grow 5% – 7% from 1,395.7 million in 2012, just shy of the company’s guidance.

Currently, Express Scripts carries a Zacks Rank #3 (Hold). Right now Covance Inc (CVD - Analyst Report), Omnicare Inc. (OCR - Snapshot Report) and Parexel International Corporation (PRXL - Snapshot Report) look better placed with a Zacks Rank #2 (Buy).

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
UTD THERAPE… UTHR 117.83 +28.51%
TRIQUINT SE… TQNT 20.67 +6.52%
RF MICRO DE… RFMD 12.47 +6.04%
VASCO DATA… VDSI 14.77 +4.68%
BANCO DO BR… BDORY 15.53 +3.95%