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Becton, Dickinson (BDX) Beats on Q3 Earnings, Guidance Solid

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Becton, Dickinson and Company (BDX - Free Report) , popularly known as BD, reported third-quarter fiscal 2017 earnings of $2.46 per share, which beat the Zacks Consensus Estimate of $2.44 and increased 4.7% on a year-over-year basis.

Interestingly, BD posted positive earnings surprises in the past four quarters, at an average of 5.6%. Furthermore, the stock currently has a Zacks Rank #2 (Buy), signifying probabilities of outperformance in the near term.

Getting back to the quarter, BD registered revenues of $3.035 billion, down 5.1% on a year-over-year basis, primarily owing to the divestiture of the Respiratory Solutions business. However, revenues were up 2.4% from the year-ago quarter on a comparable currency-neutral basis. Revenues missed the Zacks Consensus Estimate of $3.056 billion.

Segment Details

BD Medical segment:BD Medical generated revenues of $2.038 billion, down 8.8% on a year-over-year basis. However, on a comparable currency-neutral basis, revenues increased 1.3% year over year. Impressive results in the company’s medical segment reflect strong performance by the Medication and Procedural Solutions, Diabetes Care and Pharmaceutical Systems units.

BD Life Sciences segment: BD Life sciences generated revenues of $997 million, up 3.5% from the year-ago quarter. Revenue growth in the BD Life sciences segment reflects strong performance in Biosciences unit and solid growth in the Diagnostic Systems and Preanalytical Systems units.

U.S.Revenues: On a reported basis, U.S. revenues decreased 7.6% to roughly $1.603 billion, which increased 0.4% on a comparable basis.

The BD Medical segment witnessed stellar performances by the Medication and Procedural Solutions and Diabetes Care units in the U.S. However, massive growth in the segment was partially negated by sluggishness in the Medication Management Solutions and Pharmaceutical Systems units.

BD’s solid performance in the Preanalytical Systems and Biosciences units buoyed growth in the Life Sciences segment.

International revenues: BD witnessed a 2.1% decline in revenues to $1.433 billion outside the U.S. However, comparable, currency-neutral basis revenues rose 4.7% on the back of solid growth in both the segments.

Becton, Dickinson and Company Price, Consensus and EPS Surprise

 

Becton, Dickinson and Company Price, Consensus and EPS Surprise | Becton, Dickinson and Company Quote

Guidance

For fiscal 2017, on a comparable and currency-neutral basis, revenues are anticipated to increase approximately 4.5% to 5.0%. Notably, this excludes Respiratory Solutions and other divestitures that closed in fiscal 2016. Revenues are likely to decline in the range of 3% to 3.5% on a year-over-year basis, owing to the divestiture of the Respiratory Solutions business.

Fiscal 2017 adjusted earnings per share are expected to be between $9.42 and $9.47, up from the previously issued range of $9.35 to $9.45. This represents growth of 10% approximately.

Key Picks

A few other top-ranked stocks in the broader medical sector are Edwards Lifesciences Corporation (EW - Free Report) , Abiomed Inc. (ABMD - Free Report) and Dextera Surgical Inc. (DXTR - Free Report) .

Notably, Edwards Lifesciences sports a Zacks Rank #1, while Abiomed and Dextera have a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Edwards Lifesciences has a long-term expected earnings growth rate of 15.2%. Notably, the stock has a return of 3.4% over the last three months.

Abiomed yielded a strong return of 20.6% over the last one year. The stock has a long-term expected earnings growth rate of 30.5%.

Dextera has a projected sales growth of 54.8% for the current year. The stock promises a long-term expected earnings growth rate of 25%.

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