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AstraZeneca’s Stock Rises on Positive 2Q15 Earnings

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Aug. 25 2015, Published 2:32 p.m. ET

A look at AstraZeneca’s earnings

AstraZeneca (AZN) released its 2Q15 earnings on July 30, 2015. Driven by revenue growth from products like Crestor, Onglyza, Brilinta, and Zoladex, the company reported top-line growth at constant currencies for the sixth consecutive quarter.

The company surpassed Wall Street analysts’ estimates for revenues, net income, and EPS (earnings per share) for 2Q15. After the company’s earnings announcement, AstraZeneca’s share price responded positively and rose more than 2.2% to a closing price of $33.74.

 

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AstraZeneca had a recent two-for-one stock split, which was completed on July 27, 2015. The stock has returned ~1.5% year-to-date. The VanEck Vectors Pharmaceutical ETF (PPH) holds 4.54% of its investments in AstraZeneca, 4.97% in Merck & Co. (MRK), 5.66% in Pfizer (PFE), and 7.80% in Novartis AG (NVS). For updates on 2Q15 earnings for these companies, investors can refer to An Investor’s Guide to Pfizer’s 2Q15 Earnings and Novartis Stock Falls after 2Q15 Earnings Release.

Performance

Positive changes in financial guidance drove AstraZeneca stock prices upward despite a reported revenue fall of 7%. A strong performance for key drugs like Brilinta, Pulmicort, Crestor, and others led to an increase in total revenues of 2% at constant exchange rates. The foreign exchange negatively affected these revenues by ~9%, resulting in a decrease of 7% in reported revenues.

AstraZeneca is constantly working to reduce SG&A (selling, general, and administrative) expenses in order to increase spending on R&D (research and development). The changes in AstraZeneca’s performance and revenue stream are affecting the growth of the company. Are these changes in favor of the company? You’ll find out in this series.

Company overview

Headquartered in London, AstraZeneca is one of the largest pharmaceutical companies by revenue. The company’s business is spread out over the entire life cycle of medicine from research and development to manufacturing and supply of primary care and specialty care medicines. The company has more than 57,500 employees and operates in more than 100 countries. You can read more about AstraZeneca in the article AstraZeneca: A Leader in Prescription Drugs.

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