Robust revenue performance
Amgen (AMGN) expects its fiscal 2016 revenues to be in the range of $22.6 billion–$22.8 billion. The company has projected its fiscal 2016 non-GAAP (generally accepted accounting principles) EPS (earnings per share) to be in the range of $11.40–$11.55. Amgen’s non-GAAP tax rate for fiscal 2016 is anticipated to be in the range of 19%–20%, and the company expects to report capital expenditures of around $700 million for fiscal 2016.
Strong revenue growth and cost efficiencies due to transformational initiatives have been key drivers of Amgen’s robust financial performance in 2016. Notably, the SPDR S&P 500 ETF (SPY) has ~0.59% of its total portfolio in AMGN.
Wall Street analysts have projected that in 2017, Amgen’s revenues will reach ~$23.4 billion, which would mean a YoY (year-over-year) rise of ~2.7%. Peers Biogen (BIIB), Celgene (CELG), and Gilead Sciences (GILD) are expected to see revenues of $12.0 billion, $13.2 billion, and $28.2 billion, respectively.
Key growth drivers
In 2017, Amgen is expected to benefit from the strong momentum of its established brands. Additionally, the company also expects to continue launching new products across geographies to boost future revenue growth. Its robust late-stage pipeline and its effective strategy to return value to shareholders are expected to be the key factors attracting investors to Amgen in 2017.
Owing to its transformation program, Amgen expects to report a non-GAAP operating margin of around 53% in 2016. The company aims to achieve a non-GAAP operating margin in the range of 52%–54% in 2018.
To know more about Amgen’s transformation program, check out Market Realist’s “Amgen Initiates Restructuring Plan.” Continue to the next part of this series for a closer look at Amgen’s cardiovascular franchise.