For Immediate Release
Chicago, IL – February 18, 2010 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Genzyme Corporation (GENZ), Shire plc (SHPGY), Protalix BioTherapeutics Inc. (PLX), Hospira, Inc. (HSP) and XTO Energy (XTO).
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Here are highlights from Wednesday’s Analyst Blog:
Genzyme’s Profit Falls, but Beats
Genzyme Corporation (GENZ) reported fourth quarter earnings of 31 cents per share, which was well below the year-ago earnings of 42 cents. The Zacks Consensus Estimate was 20 cents. Full-year earnings came in at $2.27, well above the year-ago earnings of $1.95.
Genzyme also provided guidance for 2010. The company expects earnings to accelerate as the year progresses. While first-quarter earnings are expected to remain flat on a sequential basis, the company expects fourth quarter 2010 earnings in the range of $1.00.
For the full year, Genzyme expects to earn $2.80 – $3.20 on revenues of $5.23 – $5.53 billion. The current Zacks Consensus Estimate is $2.96. Both SG&A and R&D expenses are expected to increase as the company works on promoting its products and expanding its pipeline.
The approval of Lumizyme, potentially in June, increased manufacturing productivity for Fabrazyme and Cerezyme’s success in maintaining market share should help boost both revenue and earnings in the second half of the year.
However, we believe Cerezyme, which is approved for the treatment of Gaucher disease, could lose some share to Shire plc’s (SHPGY) velaglucerase alfa and Protalix BioTherapeutics Inc.’s (PLX) Uplyso, both of which are currently under US Food and Drug Administration (FDA) review.
Once launched, both products will compete directly with Cerezyme. Although Genzyme holds a leading position in the treatment of Gaucher disease, the patient population for the disease is not large. As such, the entry of additional players in the market could restrict its growth opportunities in the future.
Genzyme is slowly emerging from the manufacturing issues that hampered its performance in 2009. The company recently hired a new head of quality control. Genzyme also entered into a manufacturing contract with Hospira, Inc. (HSP) under which Hospira will be responsible for filling and packaging vials of key products.
We are also pleased to see that Genzyme is working on developing products that will help drive growth beyond 2011. Some of the pipeline candidates that show promise include mipomersen for high blood cholesterol, alemtuzumab for multiple sclerosis and GENZ-112638 for Gaucher disease. Genzyme is also is boosting its sales force and adding manufacturing capacity.
XTO Reports Strong Earnings
Natural gas producer XTO Energy’s (XTO) fourth quarter results came in better than expected, primarily due to a rise in production volumes. Earnings per share, excluding non-cash derivative fair value loss, came in at 93 cents, 7 cents ahead of the Zacks Consensus Estimate and 25 cents more than the prior-year period.
Revenue was up 19.4% to $2.3 billion. During the quarter, operating income increased 39.5% to $989 million, while cash flow from operations was up 27.8% to $1.7 billion.
It was the company’s fourth consecutive positive earnings surprise. XTO has performed consistently well during this period, with its average earnings surprise being 9%. This implies that the company has beaten the Zacks Consensus Estimate by 9% over the last four quarters.
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