A look at AstraZeneca
AstraZeneca (AZN) is one of the largest pharmaceuticals companies by revenues and is headquartered in London. The company’s business is spread over the entire life cycle of a medicine from research and development to manufacturing and supply of primary care and specialty care medicines. The company operates in more than 100 countries.
AstraZeneca is set to release its 1Q17 earnings on April 27, 2017. Analysts estimate the company will post EPS (or earnings per share) of $0.40 and revenues of $5.37 billion for 1Q17.
Analysts estimate that revenues for 1Q17 will fall 12.2% to $5,366 million as compared to $6,115 million for 1Q16. The revenues will likely be driven by the strong performance of the following drugs:
- Tagrisso, Lynparza, Faslodex, and Zoladex in the oncology segment
- Brilinta and Farxiga in the cardiovascular and metabolic diseases segment
- Pulmicort and Daliresp in the respiratory segment
- other drugs like Synagis and Movantik
Analysts estimate the company will post a gross profit margin of 81.6% for 1Q17, a 2.6% decrease as compared to the gross profit margin in 1Q16. Also, despite the decrease in R&D expenses, and lower selling, general, and administrative expenses as a percentage of total revenues, the EBITDA margin is expected to fall 24.1% in 1Q17 as compared to 30.6% in 1Q16. The net adjusted income is expected to increase to ~$983.6 million in 1Q17.
To divest the company-specific risks, investors can consider ETFs like the iShares S&P Global 100 ETF (IOO), which holds ~0.7% of its total assets in AstraZeneca. IOO also holds 3.1% of its total assets in Johnson & Johnson (JNJ), 2.0% of its total assets in Novartis (NVS), and 1.8% of its total assets in Merck (MRK).