Advertisement
News
Advertisement

Analysts Laud Forest Earnings

Wed, 01/22/2014 - 8:42am
The Associated Press

The growth prospects for Forest Laboratories, as well as its cost cutting, have garnered praise from industry watchers after the specialty drugmaker reported third-quarter earnings and revenue that trumped Wall Street expectations.

The New York company on Tuesday reported a profit of nearly $18 million, or 7 cents per share, in the quarter that ended Dec. 31. That compares with a loss of $153.6 million, or 58 cents per share, in last year's quarter, when the drugmaker's expenses included $76 million in licensing payments.

Adjusted earnings were 27 cents per share, and total revenue climbed nearly 23 percent to $878.4 million.

Analysts expected, on average, earnings of only 6 cents per share on $835.3 million in revenue, according to FactSet.

Forest also raised its fiscal 2014 earnings forecast to a range of $1.25 to $1.35 per share after predicting 95 cents to $1.15 per share in October.

Analysts expect full-year earnings of $1.19 per share, on average.

Shares of Forest Laboratories Inc. slid 74 cents to $68 in trading Tuesday, but the stock was still up about 13 percent so far this year.

Credit Suisse analyst Dr. Vamil Divan called the results were encouraging. Company shares fell Tuesday, which Divan attributed to a "lack of new news'"

The drugmaker announced last month that it planned to trim $500 million in costs over the next two years and buy back at least $400 million of its own stock. The changes came less than three months after former Bausch & Lomb leader Brenton Saunders replaced longtime CEO Howard Solomon.

Earlier this month, Forest said it will spend $2.9 billion in cash to buy Aptalis, which specializes in treatments for gastrointestinal problems and cystic fibrosis.

Janney Capital Markets analyst Jim Molloy reiterated his "buy" rating on the stock.

"With one of the premier primary care sales forces in specialty pharma and a new CEO focused on uncovering shareholder value, we continue to see (Forest) as a stock with a lot of running room in front of it," Malloy wrote Wednesday.

Advertisement
Advertisement

Share this Story

X
You may login with either your assigned username or your e-mail address.
The password field is case sensitive.
Loading