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Perrigo (PRGO) Down 7.5% Since Last Earnings Report: Can It Rebound?
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A month has gone by since the last earnings report for Perrigo (PRGO - Free Report) . Shares have lost about 7.5% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Perrigo due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Beats Q1 Earnings & Sales Estimates
Perrigo reported adjusted earnings of 45 cents per share in first-quarter 2023, beating the Zacks Consensus Estimate of 42 cents. Earnings were up 35.6% year over year. This upside in earnings can be attributed to lower operating expenses incurred by the company during the quarter. Excluding the negative currency impact, earnings rose 47.2%.
Net sales increased 10.0% year over year to $1.18 billion, which also topped the Zacks Consensus Estimate of $1.15 billion. Excluding the negative currency impact, sales rose 13%. The upside was driven by strategic pricing actions undertaken by management during the quarter, sales from the newly-acquired HRA Pharma and the acquisition of the U.S. & Canadian GoodStart infant formula brand. These were partially offset by unfavorable currency movements and divested Latin American businesses. Organic net sales (excluding the effects of acquisitions and divestitures and the impact of currency) were up 6.4% year over year.
Segment Discussion
CSCA: The segment’s net sales in the first quarter of 2023 came in at $763.7 million, up 7.6% year over year, driven by acquisitions and strategic price increases. However, the upside was partially offset by two voluntary recalls during the quarter — one for a major national brand infant formula and another for an OTC product.
CSCI: The segment reported net sales of $418.1 million, up 14.7% from the year-ago period’s levels. At constant-currency (cc) rates, sales were up 23.6% year over year. Organically sales increased 4.0%. Segment revenues benefited from the higher sales of HRA Pharma brands and strategic pricing actions. Sales were negatively impacted by an unfavorable currency movement.
2023 Guidance
Perrigo reiterated its financial guidance for 2023. Management expects to report net sales growth in the range of 7-11%. Adjusted earnings per share is expected to be between $2.50 and $2.70. Adjusted tax rate is expected to be around 21.5%, while the company expects to record interest expense of around $180 million.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
The consensus estimate has shifted -9.92% due to these changes.
VGM Scores
Currently, Perrigo has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Perrigo has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
Perrigo belongs to the Zacks Medical - Products industry. Another stock from the same industry, Bio-Rad Laboratories (BIO - Free Report) , has gained 1.9% over the past month. More than a month has passed since the company reported results for the quarter ended March 2023.
Bio-Rad reported revenues of $676.84 million in the last reported quarter, representing a year-over-year change of -3.3%. EPS of $3.34 for the same period compares with $4.94 a year ago.
Bio-Rad is expected to post earnings of $2.90 per share for the current quarter, representing a year-over-year change of -14.2%. Over the last 30 days, the Zacks Consensus Estimate has changed -14.6%.
Bio-Rad has a Zacks Rank #4 (Sell) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of F.
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Perrigo (PRGO) Down 7.5% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for Perrigo (PRGO - Free Report) . Shares have lost about 7.5% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Perrigo due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Beats Q1 Earnings & Sales Estimates
Perrigo reported adjusted earnings of 45 cents per share in first-quarter 2023, beating the Zacks Consensus Estimate of 42 cents. Earnings were up 35.6% year over year. This upside in earnings can be attributed to lower operating expenses incurred by the company during the quarter. Excluding the negative currency impact, earnings rose 47.2%.
Net sales increased 10.0% year over year to $1.18 billion, which also topped the Zacks Consensus Estimate of $1.15 billion. Excluding the negative currency impact, sales rose 13%. The upside was driven by strategic pricing actions undertaken by management during the quarter, sales from the newly-acquired HRA Pharma and the acquisition of the U.S. & Canadian GoodStart infant formula brand. These were partially offset by unfavorable currency movements and divested Latin American businesses. Organic net sales (excluding the effects of acquisitions and divestitures and the impact of currency) were up 6.4% year over year.
Segment Discussion
CSCA: The segment’s net sales in the first quarter of 2023 came in at $763.7 million, up 7.6% year over year, driven by acquisitions and strategic price increases. However, the upside was partially offset by two voluntary recalls during the quarter — one for a major national brand infant formula and another for an OTC product.
CSCI: The segment reported net sales of $418.1 million, up 14.7% from the year-ago period’s levels. At constant-currency (cc) rates, sales were up 23.6% year over year. Organically sales increased 4.0%. Segment revenues benefited from the higher sales of HRA Pharma brands and strategic pricing actions. Sales were negatively impacted by an unfavorable currency movement.
2023 Guidance
Perrigo reiterated its financial guidance for 2023. Management expects to report net sales growth in the range of 7-11%. Adjusted earnings per share is expected to be between $2.50 and $2.70. Adjusted tax rate is expected to be around 21.5%, while the company expects to record interest expense of around $180 million.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
The consensus estimate has shifted -9.92% due to these changes.
VGM Scores
Currently, Perrigo has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Perrigo has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
Perrigo belongs to the Zacks Medical - Products industry. Another stock from the same industry, Bio-Rad Laboratories (BIO - Free Report) , has gained 1.9% over the past month. More than a month has passed since the company reported results for the quarter ended March 2023.
Bio-Rad reported revenues of $676.84 million in the last reported quarter, representing a year-over-year change of -3.3%. EPS of $3.34 for the same period compares with $4.94 a year ago.
Bio-Rad is expected to post earnings of $2.90 per share for the current quarter, representing a year-over-year change of -14.2%. Over the last 30 days, the Zacks Consensus Estimate has changed -14.6%.
Bio-Rad has a Zacks Rank #4 (Sell) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of F.