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Becton, Dickinson (BDX) Q3 Earnings: What's in the Cards?

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Becton, Dickinson and Company (BDX - Free Report) is set to report third-quarter fiscal 2016 earnings results on Aug 4. Last quarter, Becton, Dickinson beat the Zacks Consensus Estimate by almost 8.5% (17 cents).

We note that on average, the company delivered a positive earnings surprise of 5.04% through the last four quarters.

Let’s see how things are shaping up prior to this announcement.

Factors at Play

Becton, Dickinson's innovative product pipeline is a key catalyst in our view. A plethora of regulatory approvals both in the U.S. and International markets is aiding the company to rapidly expand its product portfolio.
 

BECTON DICKINSO Price and EPS Surprise

BECTON DICKINSO Price and EPS Surprise | BECTON DICKINSO Quote

Management at Becton, Dickinson expects strong demand for its Pyxis ES platform and infusion pumps to be the primary growth drivers in the third quarter.

Additionally, partnerships and collaborations are also providing the company a competitive edge. Moreover, the CareFusion merger has unlocked considerable growth and cost saving opportunities for Becton, Dickinson.

However, unfavorable foreign exchange rate is anticipated to remain a headwind for the rest of year. Tough year-over-year comparisons in the third quarter also remain a concern.

Earnings Whispers

Our proven model does not conclusively show that Becton, Dickinson is likely to beat on earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank of #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.

Zacks ESP: Becton, Dickinson currently has an Earnings ESP of 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate stand at $2.20.

Zacks Rank: Becton, Dickinson has a Zacks Rank #3 which increases the predictive power of ESP. However, a 0.00% ESP makes surprise prediction difficult.

We caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks to Consider

Here are some companies you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:  

Nektar Therapeutics (NKTR - Free Report) with an Earnings ESP of +50.00% and Zacks Rank #1.

GlycoMimetics Inc. (GLYC - Free Report) with an Earnings ESP of +13.64% and Zacks Rank #1.

ANI Pharmaceuticals Inc. (ANIP - Free Report) with an Earnings ESP of +2.63% and a Zacks Rank #1.

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