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Becton, Dickinson (BDX) Q2 Earnings Beat, Increase Y/Y

Becton, Dickinson and Company BDX, popularly known as BD, reported second-quarter fiscal 2017 earnings of $2.30 per share, which beat the Zacks Consensus Estimate of $2.23 and increased 5.5% on a year-over-year basis.

Interestingly, BD has posted positive earnings surprises in the past four quarters, at an average of 6.9%. 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 $2.969 billion, beating the Zacks Consensus Estimate of $2.921 billion. Revenues fell 3.2% on a year-over-year basis. However, on a comparable, currency-neutral basis, revenues increased 5.2% in the second quarter.

Becton, Dickinson and Company Price, Consensus and EPS Surprise

 

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

Segment Details

BD Medical segment: Revenues at the segment decreased 6.8% year over year to $1.987 billion owing to the divestiture of the Respiratory Solutions business in Oct 2016.

However, the segment witnessed strong performance by the Pharmaceutical Systems and Medication Management Solutions units. Results were partially affected by the timing of customer orders and capital placement.

Of the major highlights at the BD Medical segment, the company is expected to make notable changes in its U.S. dispensing business model within the Medication Management Solutions unit.

BD Life Sciences segment: Revenues at the segment increased 4.9% from the year-ago quarter to $982 million. This marked an increase of 5.8% on a currency-neutral basis. The upside came from improvement in Diagnostic Systems and Preanalytical Systems units.

However, BD Life Sciences segment witnessed a decrease in revenues at the Biosciences unit.

Geographically, on a reported basis, U.S. revenues decreased 5.4% to roughly $1.627 billion, while International revenues were flat at $1.342 billion. On a comparable basis, adjusted U.S. revenues increased 4%. International revenues rose 6.5% on a currency-neutral basis in the reported quarter.

Guidance

The company maintained its fiscal 2017 revenue and adjusted earnings 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.

Meanwhile, adjusted earnings (on a currency-neutral basis) are expected in the range of $9.70 to $9.80, reflecting year-over-year growth of 13.0% to 14.0%.

However, after including the estimated unfavorable impact from foreign currency, the company expects adjusted diluted earnings per share between $9.35 and $9.45, representing growth of approximately 9% to 10%.

Other Key Picks

Other top-ranked stocks in the broader medical sector include Neovasc Inc. NVCN, Hologic, Inc. HOLX and Sunshine Heart Inc SSH. Notably, all the stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Hologic has a long-term expected earnings growth rate of 11.33%. The stock has a solid one-year return of roughly 32.8%.

Sunshine Heart posted a positive earnings surprise of 58.24% in the last reported quarter. The stock recorded a stellar EPS growth rate (last 3–5 years of actual earnings) of almost 22%.

Neovasc saw a stellar gain of 14% over the last three months. The stock has a projected sales growth of 102.88% for the current year.

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Becton, Dickinson and Company (BDX): Free Stock Analysis Report
 
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