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AmerisourceBergen (ABC) to Post Q2 Earnings: What's in Store?
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AmerisourceBergen Corporation is scheduled to release fiscal 2023 second-quarter results on May 2, before the opening bell.
In the last reported quarter, the company delivered an earnings surprise of 3.44%. Its earnings beat estimates in each of the trailing four quarters, the average surprise being 3.47%.
Q2 Estimates
The Zacks Consensus Estimate for revenues is pegged at $60.81 billion, indicating an improvement of 5.4% from that reported in the prior-year quarter. The same for earnings stands at $3.27 per share, implying growth of 1.6% from the year-ago quarter’s reported figure.
Factors to Note
Sustained strong growth in specialty product sales, coupled with broad-based solid performance and utilization trends across the portfolio in the U.S. Healthcare Solutions segment, might have favored ABC’s fiscal second-quarter performance.
The commercial COVID-19 treatments recorded lower sales in the past two quarters. This trend is likely to have continued in the soon-to-be-reported quarter. Revenues from the U.S. Healthcare Solutions segment are expected to grow 6-8% in fiscal 2023. This may get reflected in the fiscal second-quarter results as well. Our model expects second-quarter revenues for this segment to be $54.6 billion.
Operating income in this segment is anticipated to grow 1-4% in fiscal 2023. This is likely to get reflected in the fiscal second-quarter results. Our model predicts the segment’s adjusted operating income to be $735.4 million for the second quarter.
Apart from this, the International Healthcare Solutions segment’s World Courier unit is expected to have exhibited solid performance in the quarter under review. In fact, the unit’s impressive track record as an international leader in specialty logistics has enabled AmerisourceBergen to serve customers globally. The company was able to do so despite a challenging COVID-induced environment and additional operational challenges.
AmerisourceBergen Corporation Price and EPS Surprise
Moreover, the products of Alliance Healthcare, which was acquired by ABC in 2021, are likely to have driven the latter’s top-line performance. However, the unfavorable impact of foreign currency translation and the divestiture of the Profarma specialty must have offset growth from World Courier and Alliance Healthcare.
Per the fiscal 2023 guidance, operating income at the International Healthcare Solutions segment is estimated to improve 1-4%. This is likely to get reflected in the to-be-reported quarter. Our model predicts the segment’s adjusted operating income and revenues to be $135.5 million and $6.3 billion, respectively.
On its fiscal 2023 second-quarter earnings call, AmerisourceBergen will likely provide an update on the integration of its recently-completed acquisition of PharmaLex.
What Our Quantitative Model Suggests
Per our proven model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is not the case here as you will see below.
Earnings ESP: AmerisourceBergen has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company carries a Zacks Rank #3.
Stocks to Consider
Here are a few medical stocks worth considering as these have the right combination of elements to come up with an earnings beat this reporting cycle:
HSIC has an estimated long-term growth rate of 8.1%. Henry Schein’s earnings surpassed estimates in three of the trailing four quarters and met once, the average surprise being 2.97%.
BioRad Laboratories (BIO - Free Report) has an Earnings ESP of +0.16% and a Zacks Rank of 2 at present. BIO has an earnings yield of 3.3%, which compares favorably with the industry’s negative yield of 2.9%.
BioRad Laboratories’ earnings surpassed estimates in three of the trailing four quarters and missed the same once, the average surprise being 27.54%.
McKesson (MCK - Free Report) has an Earnings ESP of +1.22% and a Zacks Rank #3 at present. MCK has an estimated long-term growth rate of 10.4%.
McKesson’s earnings surpassed estimates in two of the trailing four quarters and missed the mark in the other two, the average surprise being 3.42%.
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AmerisourceBergen (ABC) to Post Q2 Earnings: What's in Store?
AmerisourceBergen Corporation is scheduled to release fiscal 2023 second-quarter results on May 2, before the opening bell.
In the last reported quarter, the company delivered an earnings surprise of 3.44%. Its earnings beat estimates in each of the trailing four quarters, the average surprise being 3.47%.
Q2 Estimates
The Zacks Consensus Estimate for revenues is pegged at $60.81 billion, indicating an improvement of 5.4% from that reported in the prior-year quarter. The same for earnings stands at $3.27 per share, implying growth of 1.6% from the year-ago quarter’s reported figure.
Factors to Note
Sustained strong growth in specialty product sales, coupled with broad-based solid performance and utilization trends across the portfolio in the U.S. Healthcare Solutions segment, might have favored ABC’s fiscal second-quarter performance.
The commercial COVID-19 treatments recorded lower sales in the past two quarters. This trend is likely to have continued in the soon-to-be-reported quarter. Revenues from the U.S. Healthcare Solutions segment are expected to grow 6-8% in fiscal 2023. This may get reflected in the fiscal second-quarter results as well. Our model expects second-quarter revenues for this segment to be $54.6 billion.
Operating income in this segment is anticipated to grow 1-4% in fiscal 2023. This is likely to get reflected in the fiscal second-quarter results. Our model predicts the segment’s adjusted operating income to be $735.4 million for the second quarter.
Apart from this, the International Healthcare Solutions segment’s World Courier unit is expected to have exhibited solid performance in the quarter under review. In fact, the unit’s impressive track record as an international leader in specialty logistics has enabled AmerisourceBergen to serve customers globally. The company was able to do so despite a challenging COVID-induced environment and additional operational challenges.
AmerisourceBergen Corporation Price and EPS Surprise
AmerisourceBergen Corporation price-eps-surprise | AmerisourceBergen Corporation Quote
Moreover, the products of Alliance Healthcare, which was acquired by ABC in 2021, are likely to have driven the latter’s top-line performance. However, the unfavorable impact of foreign currency translation and the divestiture of the Profarma specialty must have offset growth from World Courier and Alliance Healthcare.
Per the fiscal 2023 guidance, operating income at the International Healthcare Solutions segment is estimated to improve 1-4%. This is likely to get reflected in the to-be-reported quarter. Our model predicts the segment’s adjusted operating income and revenues to be $135.5 million and $6.3 billion, respectively.
On its fiscal 2023 second-quarter earnings call, AmerisourceBergen will likely provide an update on the integration of its recently-completed acquisition of PharmaLex.
What Our Quantitative Model Suggests
Per our proven model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is not the case here as you will see below.
Earnings ESP: AmerisourceBergen has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company carries a Zacks Rank #3.
Stocks to Consider
Here are a few medical stocks worth considering as these have the right combination of elements to come up with an earnings beat this reporting cycle:
Henry Schein (HSIC - Free Report) has an Earnings ESP of +0.99% and a Zacks Rank of 2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
HSIC has an estimated long-term growth rate of 8.1%. Henry Schein’s earnings surpassed estimates in three of the trailing four quarters and met once, the average surprise being 2.97%.
BioRad Laboratories (BIO - Free Report) has an Earnings ESP of +0.16% and a Zacks Rank of 2 at present. BIO has an earnings yield of 3.3%, which compares favorably with the industry’s negative yield of 2.9%.
BioRad Laboratories’ earnings surpassed estimates in three of the trailing four quarters and missed the same once, the average surprise being 27.54%.
McKesson (MCK - Free Report) has an Earnings ESP of +1.22% and a Zacks Rank #3 at present. MCK has an estimated long-term growth rate of 10.4%.
McKesson’s earnings surpassed estimates in two of the trailing four quarters and missed the mark in the other two, the average surprise being 3.42%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.