St. Louis, MO-based pharmacy benefit manager Express Scripts Holding Company posted fourth-quarter 2016 adjusted earnings per share of $1.88, beating the Zacks Consensus Estimate by a penny. Furthermore, adjusted earnings jumped 20.5% from the year-ago quarter.
Revenues of $24.8 billion missed the Zacks Consensus Estimate of $26.2 billion and were down 5% on a year-over-year basis.
For the full year, Express Scripts reported revenues of $100.3 billion, down from the year-ago figure of $101.7 billion.
Stock Performance
The price performance of the stock has been unfavorable over the last three months.
Express Scripts registered a negative return of 10.6%, wider than the Zacks classified Medical Services sub-industry’s decline of almost 2.7%. In fact, the current level is also lower than the S&P 500’s solid return of around 6% over the same time frame.
Despite the bearish price trend, a long-term expected earnings growth rate of 11.8% instills our confidence in the stock. Currently, Express Scripts has a Zacks Rank #2 (Buy).
Quarterly Highlights
Adjusted gross profit in the fourth quarter was up 3.3% to $2.3 billion. Adjusted selling, general and administrative expenses were $863.5 million, down 17.7%.
Total adjusted claims amounted to $354.9 million, down 6% year over year due to faster roll-off of the Coventry business.
During the quarter, the company repurchased a total 74.4 million shares under its repurchase program of $5.57 billion during 2016.
Guidance
For the full year, Express Scripts reaffirmed its adjusted earnings per share guidance in the band of $6.82 to $7.02. Notably, this represents growth of 8% at the mid-point of the range on a year-over-year basis.
For the first quarter of 2017, adjusted earnings are estimated in the range of $1.30 to $1.34 per share, representing growth of 7% to 10% on a year-over-year basis. Adjusted claims for the first quarter are projected between $345 million and $355 million.
Stocks to Consider
Better-ranked stocks in the broader medical sector include Glaukos Corporation (GKOS - Free Report) , Avinger, Inc. (AVGR - Free Report) and Fluidigm Corporation . Notably, Glaukos Corporation and Fluidigm sport a Zacks Rank #1 (Strong Buy), while Avinger has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Glaukos Corporation has a long-term expected earnings growth rate of approximately 25%. Notably, the stock represents an impressive one-year return of 197%.
Fluidigm Corporation has a long-term expected earnings growth rate of 25%. The stock has added 11.4% over the last three months.
Avinger projects sales growth of 2.3% for the current year. Additionally, the company posted a positive earnings surprise of 27% in the last quarter.
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It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
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St. Louis, MO-based pharmacy benefit manager Express Scripts Holding Company posted fourth-quarter 2016 adjusted earnings per share of $1.88, beating the Zacks Consensus Estimate by a penny. Furthermore, adjusted earnings jumped 20.5% from the year-ago quarter.
Revenues of $24.8 billion missed the Zacks Consensus Estimate of $26.2 billion and were down 5% on a year-over-year basis.
For the full year, Express Scripts reported revenues of $100.3 billion, down from the year-ago figure of $101.7 billion.
Stock Performance
The price performance of the stock has been unfavorable over the last three months.
Express Scripts registered a negative return of 10.6%, wider than the Zacks classified Medical Services sub-industry’s decline of almost 2.7%. In fact, the current level is also lower than the S&P 500’s solid return of around 6% over the same time frame.
Despite the bearish price trend, a long-term expected earnings growth rate of 11.8% instills our confidence in the stock. Currently, Express Scripts has a Zacks Rank #2 (Buy).
Quarterly Highlights
Adjusted gross profit in the fourth quarter was up 3.3% to $2.3 billion. Adjusted selling, general and administrative expenses were $863.5 million, down 17.7%.
Total adjusted claims amounted to $354.9 million, down 6% year over year due to faster roll-off of the Coventry business.
During the quarter, the company repurchased a total 74.4 million shares under its repurchase program of $5.57 billion during 2016.
Guidance
For the full year, Express Scripts reaffirmed its adjusted earnings per share guidance in the band of $6.82 to $7.02. Notably, this represents growth of 8% at the mid-point of the range on a year-over-year basis.
For the first quarter of 2017, adjusted earnings are estimated in the range of $1.30 to $1.34 per share, representing growth of 7% to 10% on a year-over-year basis. Adjusted claims for the first quarter are projected between $345 million and $355 million.
Stocks to Consider
Better-ranked stocks in the broader medical sector include Glaukos Corporation (GKOS - Free Report) , Avinger, Inc. (AVGR - Free Report) and Fluidigm Corporation . Notably, Glaukos Corporation and Fluidigm sport a Zacks Rank #1 (Strong Buy), while Avinger has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Glaukos Corporation has a long-term expected earnings growth rate of approximately 25%. Notably, the stock represents an impressive one-year return of 197%.
Fluidigm Corporation has a long-term expected earnings growth rate of 25%. The stock has added 11.4% over the last three months.
Avinger projects sales growth of 2.3% for the current year. Additionally, the company posted a positive earnings surprise of 27% in the last quarter.
Zacks' Top Investment Ideas for Long-Term Profit
How would you like to see our best recommendations to help you find today’s most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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