Will Amgen (AMGN) Miss This Earnings Season?

Zacks

Amgen Inc. (AMGN) is set to report fourth quarter 2013 results on Jan 28 after market close. Last quarter, the company had posted an earnings surprise of +12.21%. Let’s see how things are shaping up for this announcement.

Factors at Play

While products like Enbrel, Prolia, Xgeva, Neupogen and Neulasta should continue performing well, Aranesp sales will remain under pressure due to lower demand in the U.S. (resulting from dose reductions) and in Europe due to competition and price cuts. Meanwhile, results will be affected by higher operating costs specially related to the promotion of Enbrel.  

Earnings Whispers?

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

Zacks ESP: The Earnings ESP for Amgen is 0.00% since the Most Accurate Estimate stands at $1.64, in line with the Zacks Consensus Estimate.

Zacks Rank #3 (Hold): Amgen’s Zacks Rank #3 (Hold) has little effect on the predictive power of ESP because the Zacks Rank #3 when combined with a 0.00% ESP makes surprise prediction difficult.

Other Stocks to Consider

Here are some other companies you may want to consider as our model shows that they have the right combination of elements, i.e., a positive Zacks Earnings ESP and a Zacks Rank #1, #2 or #3:

Actavis plc (ACT) has an Earnings ESP of +0.33% and holds a Zacks Rank #2 (Buy). Actavis will be reporting fourth quarter earnings on Feb 20.

Biogen Idec Inc. (BIIB) has an Earnings ESP of +9.01% and holds a Zacks Rank #2. Biogen will be reporting fourth quarter earnings on Jan 29.

Sanofi (SNY) has earnings ESP of +2.27% and holds a Zacks Rank #3. Sanofi will report fourth quarter earnings on Feb 6.

Read the Full Research Report on AMGN
Read the Full Research Report on ACT
Read the Full Research Report on SNY
Read the Full Research Report on BIIB


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