Revised financial guidance
Based on 2Q15 operating performance and strong execution across all business segments during the first half of 2015, Pfizer (PFE) revised its financial guidance for 2015 during its 2Q15 earnings release. The company has raised its midpoints of financial guidance for reported revenue by $500 million, and for adjusted EPS (earnings per share) by $0.04.
The company’s financial guidance suggests reported revenues between $45 billion to $46 billion, while analysts’ estimated revenues are ~$46.05 billion for 2015. Also, the company’s financial guidance suggests adjusted EPS to be $2.01 to $2.07, while analysts’ estimates suggest adjusted EPS to be $2.05 for 2015.
Pfizer has achieved top-line operational growth over the last three quarters, which is the company’s priority. In the revised financial guidance, the company has considered all the completed transactions until 2Q15. However, the revised financial guidance doesn’t include the impact from pending transactions in the pipeline like the acquisition of Hospira. You can read more details about the Hospira deal in the article Pfizer-Hospira Deal: A win-win situation.
Important factors to be considered
The following key factors could have a significant impact on Pfizer’s revenues:
- The development of immune-oncology products under the global strategic alliance with Merck KGaA, Germany
- The pending acquisition of Hospira, which is expected to close in the second half of 2015
- The acquisition of Redvax GmbH for its vaccines portfolio
- Approval of the new drug application for Xeljanz (once daily version) by the FDA
- Opko Health (OPK) and Pfizer’s agreement for development and commercialization of hGH-CTP, a long-acting human growth hormone
- The increase in revenue base due to the contribution of emerging markets as well as new product launches
Apart from Pfizer, Merck and Co. (MRK), Bristol-Myers Squibb (BMY), Roche, and AstraZeneca (AZN) are also enhancing their oncology products portfolio. Investors can consider the Health Care Select Sector SPDR ETF (XLV), which is focused on pharmaceuticals and healthcare companies.