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Cencora (COR) to Report Q1 Earnings: What's in the Cards?
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Cencora (COR - Free Report) is scheduled to release first-quarter fiscal 2024 results on Jan 31, before the opening bell.
In the last reported quarter, the company delivered an earnings surprise of 2.51%. Its earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 3.88%.
Please note that Cencora was formerly known as AmerisourceBergen, which changed its name and ticker symbol to Cencora and COR, respectively, effective Aug 30.
Q1 Estimates
The Zacks Consensus Estimate for revenues is pegged at $68.81 billion, indicating an improvement of 9.5% from that reported in the prior-year quarter. The same for earnings is pinned at $2.85 per share, implying growth of 5.2% from the year-ago quarter’s reported number.
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 COR’s fiscal first-quarter performance. High demand for recently-approved GLP-1 drugs for diabetes and/or weight loss is likely to have boosted growth. Moreover, the new distribution center in California will continue to support its scale of supply.
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 7-10% in fiscal 2024. This may be reflected in the fiscal first-quarter results as well. Our model expects first-quarter revenues for this segment to be $61.2 billion.
Operating income at the aforementioned segment is anticipated to grow 4-7% in fiscal 2024. This is likely to be reflected in the fiscal first-quarter results. Our model predicts the segment’s adjusted operating income to be $610.5 million.
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 Cencora to serve customers globally. The company was able to do so despite a challenging COVID-induced environment and additional operational challenges. The addition of PharmaLex in 2023 is also likely to bring additional revenues.
Per the fiscal 2024 guidance, operating income at the International Healthcare Solutions segment is estimated to grow 1-4%. This is likely to be reflected in the upcoming quarterly results. Our model expects the segment’s adjusted operating income and revenues to be $164.6 million and $6.9 billion, respectively.
Although revenues and operating income are likely to be on the higher side, gross margin is likely to get hurt during the soon-to-be-reported quarter due to higher volumes of low-margin GLP-1 products, coupled with lower volumes of high-margin government-owned COVID treatments.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Cencora this time around. 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. This is not the case here, as you will see below.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate is 0.00% for COR at present. 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 #2 at present.
Stocks Worth a Look
Here are some medical stocks worth considering as these have the right combination of elements to post an earnings beat this reporting cycle.
The stock has fallen 5.2% in the past year. XRAY’s earnings beat estimates in the last reported quarter. It has a trailing four-quarter average earnings surprise of 20.65%.
Merit Medical Systems (MMSI - Free Report) has an Earnings ESP of +3.68% and a Zacks Rank of 2 at present.
The stock has risen 15% in the past year. MMSI’s earnings beat estimates in the last reported quarter. It has a trailing four-quarter average earnings surprise of 14.41%.
AMN Healthcare Services (AMN - Free Report) has an Earnings ESP of +3.42% and a Zacks Rank of 3 at present.
The stock has fallen 22.3% in the past year. COO’s earnings beat estimates in the last reported quarter. It has a trailing four-quarter average earnings surprise of 12.66%.
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Cencora (COR) to Report Q1 Earnings: What's in the Cards?
Cencora (COR - Free Report) is scheduled to release first-quarter fiscal 2024 results on Jan 31, before the opening bell.
In the last reported quarter, the company delivered an earnings surprise of 2.51%. Its earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 3.88%.
Please note that Cencora was formerly known as AmerisourceBergen, which changed its name and ticker symbol to Cencora and COR, respectively, effective Aug 30.
Q1 Estimates
The Zacks Consensus Estimate for revenues is pegged at $68.81 billion, indicating an improvement of 9.5% from that reported in the prior-year quarter. The same for earnings is pinned at $2.85 per share, implying growth of 5.2% from the year-ago quarter’s reported number.
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 COR’s fiscal first-quarter performance. High demand for recently-approved GLP-1 drugs for diabetes and/or weight loss is likely to have boosted growth. Moreover, the new distribution center in California will continue to support its scale of supply.
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 7-10% in fiscal 2024. This may be reflected in the fiscal first-quarter results as well. Our model expects first-quarter revenues for this segment to be $61.2 billion.
Operating income at the aforementioned segment is anticipated to grow 4-7% in fiscal 2024. This is likely to be reflected in the fiscal first-quarter results. Our model predicts the segment’s adjusted operating income to be $610.5 million.
Cencora, Inc. Price and EPS Surprise
Cencora, Inc. price-eps-surprise | Cencora, Inc. Quote
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 Cencora to serve customers globally. The company was able to do so despite a challenging COVID-induced environment and additional operational challenges. The addition of PharmaLex in 2023 is also likely to bring additional revenues.
Per the fiscal 2024 guidance, operating income at the International Healthcare Solutions segment is estimated to grow 1-4%. This is likely to be reflected in the upcoming quarterly results. Our model expects the segment’s adjusted operating income and revenues to be $164.6 million and $6.9 billion, respectively.
Although revenues and operating income are likely to be on the higher side, gross margin is likely to get hurt during the soon-to-be-reported quarter due to higher volumes of low-margin GLP-1 products, coupled with lower volumes of high-margin government-owned COVID treatments.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Cencora this time around. 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. This is not the case here, as you will see below.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate is 0.00% for COR at present. 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 #2 at present.
Stocks Worth a Look
Here are some medical stocks worth considering as these have the right combination of elements to post an earnings beat this reporting cycle.
Dentsply Sirona (XRAY - Free Report) has an Earnings ESP of +6.43% and a Zacks Rank of 3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The stock has fallen 5.2% in the past year. XRAY’s earnings beat estimates in the last reported quarter. It has a trailing four-quarter average earnings surprise of 20.65%.
Merit Medical Systems (MMSI - Free Report) has an Earnings ESP of +3.68% and a Zacks Rank of 2 at present.
The stock has risen 15% in the past year. MMSI’s earnings beat estimates in the last reported quarter. It has a trailing four-quarter average earnings surprise of 14.41%.
AMN Healthcare Services (AMN - Free Report) has an Earnings ESP of +3.42% and a Zacks Rank of 3 at present.
The stock has fallen 22.3% in the past year. COO’s earnings beat estimates in the last reported quarter. It has a trailing four-quarter average earnings surprise of 12.66%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.