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Becton Dickinson (BDX) Earnings Surpass Estimates in Q2

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Becton, Dickinson and Company  (BDX - Free Report) , also known as BD, reported second-quarter fiscal 2021 adjusted earnings per share (EPS) of $3.19, which beat the Zacks Consensus Estimate of $3.04 by 4.9%. The bottom line also rose 25.1% on a year-over-year basis and grew 22.7% at constant currency (cc) as well.

Revenue Details

For the quarter, the company raked in revenues of $4.90 billion, beating the Zacks Consensus Estimate by 1.5%. Also, the top line grew 15.4% from the year-ago quarter on a reported basis and 12.2% on a currency-neutral basis.

Segment Details

BD Medical

For the quarter under review, the company reported worldwide revenues of $2.30 billion, up 7.4% from the year-ago quarter on a reported basis and 4.7% at cc. Per management, this upside can be particularly attributed to growth in Medication Delivery Solutions and Pharmaceutical Systems units.

BD Life Science

Worldwide revenues in the segment totaled $1.60 billion, up 42.5% year over year on a reported basis and 37.7% at cc. Per management, this upside was driven by strong sales of Integrated Diagnostic Solutions unit, associated with COVID-diagnostic testing solutions, which includes BD Veritor  Plus and BD Max  platforms.

BD Interventional

This segment generated worldwide revenues of $1 billion, up 2.1% from the year-ago quarter on a reported basis and at flat growth rate at cc. This was owing to the segment's strong performance within the Peripheral Intervention, and Urology and Critical Care units.

Geographic Results

US

In the fiscal second quarter, revenues in the United States grew 1.9% to $2.50 billion. Per management, solid performance in the  United States  primarily reflects higher sales associated with COVID-testing solutions .

International

Revenues outside the United States grossed $2.40 billion, up 33% from the year-ago quarter on reported basis and 25.7% on currency-neutral basis. Per management, this upside was driven by a strong performance, primarily in the BD Medical and BD Life Sciences segments.

Margin Analysis

In the fiscal second quarter, gross profit amounted to $2.2 billion, up 29.6% from the prior-year quarter’s tally. Gross margin was 45.8%, up 502 basis points (bps) from the prior-year quarter.

Adjusted operating profit amounted to $781 million, up 75.9% from the year-ago figure. Adjusted operating margin was 15.9%, up 548 bps.

 

Becton, Dickinson and Company Price, Consensus and EPS Surprise

Becton, Dickinson and Company Price, Consensus and EPS Surprise

 

Becton, Dickinson and Company price-consensus-eps-surprise-chart | Becton, Dickinson and Company Quote

 

Cash Position

The company exited the second quarter of fiscal 2021 with cash and cash equivalents of $3.70 billion compared with $3.25 billion at the end of the first quarter of fiscal 2021.

Cumulative net cash provided by operating activities came in at $2.72 billion compared with $1.19 million in the year-ago period.

Fiscal 2021 Guidance

For the current fiscal year, revenues are projected to grow 12-14% on a reported basis and 10-12% on a currency-neutral basis, at par with the previously-issued guidance. The Zacks Consensus Estimate for the same is pegged at $19.45 billion.

For full fiscal, adjusted EPS is reaffirmed between  $12.75  and  $12.85.  The current projection again suggests growth of almost 25-26% from the prior fiscal year’s reported number. The Zacks Consensus Estimate for the same is pegged at $12.82.

Wrapping Up

BD exited the second quarter of fiscal 2021 on a strong note. Within the  United States, the Diagnostic Systems unit witnessed strong revenue growth on frequent COVID-19 testing.  Further, the company continues to see solid demand for its product portfolio that supports the global COVID-response efforts, especially the recent launch of its rapid point-of-care antigen test. It also saw revenue growth in each of its core segments. Both domestic and international revenues increased year over year in the quarter under review. Acquisition of GSL Solutions in the quarter instills optimism. A plethora of regulatory approvals is also encouraging.

Additionally, expansion of both gross and adjusted operating margins is another positive.

However, unfavorable foreign currency affected BD’s quarterly bottom line.

Zacks Rank and Key Picks

BD currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader medical space are Boston Scientific Corporation (BSX - Free Report) , Integer Holdings Corporation (ITGR - Free Report) and HCA Healthcare, Inc. (HCA - Free Report) , each currently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Boston Scientific posted adjusted earnings per share (EPS) of 37 cents for the first quarter of 2021, which exceeded the Zacks Consensus Estimate by 23.3%. Revenues of $2.75 billion also exceeded the Zacks Consensus Estimate by 5.3%.

Integer Holdings reported first-quarter 2021 adjusted EPS of 97 cents, which outpaced the Zacks Consensus Estimate by 12.8%. Revenues of $290.5 million also beat the Zacks Consensus Estimate by 2.6%.

HCA Healthcare reported first-quarter 2021 adjusted EPS of $4.14, surpassing the Zacks Consensus Estimate by 23.6%. Net revenues of $14 billion too trumped the Zacks Consensus Estimate by 2.2%.

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