Yahoo Finance What's in Store for West Pharmaceutical (WST) in Q4 Earnings?
West Pharmaceutical Services WST is scheduled to release fourth-quarter 2022 results on Feb 16, before the opening bell. In the last reported quarter, the company delivered a negative earnings surprise of 4.25%. Its earnings beat estimates in three of the trailing four quarters and missed once, the average surprise being 5.07%.
Q4 Estimates
Currently, the Zacks Consensus Estimate for fourth-quarter revenues is pegged at $655.2 million, indicating a decline of 10.3% from the year-ago reported figure. The consensus mark for earnings stands at $1.39 per share, indicating a decline of 31.9% from the prior-year quarter.
Factors to Note
West Pharmaceutical’s Proprietary Products business is likely to have exhibited sustained strength and contributed to the company’s top-line growth in the fourth quarter. Apart from this, the company is likely to have witnessed margin expansion in the aforementioned segment in the to-be-reported quarter, owing to a favorable mix of products sold (stemming from the demand in HVP), production efficiencies and higher sales price.
The company has been witnessing strong uptake of HVP components, which include Westar and NovaPure offerings. This momentum is likely to have been sustained in the quarter to be reported. However, delays in expansion projects, customer delivery timing and mix-shift-related productivity impacts may have hurt sales growth of high-value products (HVP).
West Pharmaceutical has been making significant efforts to retain customers’ faith in the company amid the uncertainty triggered by the pandemic. Apart from ensuring the well-being and safety of team members worldwide, it has successfully continued the manufacturing and supply of components to customers. This, in turn, might have favored its fourth-quarter performance.
West Pharmaceuticals’ business is exposed to foreign currency exchange rate fluctuations, which is likely to have adversely impacted the company’s fourth-quarter performance. The company had lowered its full-year guidance for revenues and adjusted earnings per share (EPS) on its third-quarter earnings call, primarily citing unfavorable foreign currency movements. It also expects COVID-related sales to decline further in the last quarter of 2022, after declining year over year in the past two quarters.
West Pharmaceutical Services, Inc. Price and Consensus
West Pharmaceutical Services, Inc. price-consensus-chart | West Pharmaceutical Services, Inc. Quote
The overall top line is likely to have been hampered by the aforementioned constraints, despite registering sustained growth in non-COVID-19 demand during the fourth quarter.
What Our Quantitative Model Suggests
Per our proven model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is not the case here as you will see.
Earnings ESP: West Pharmaceuticals has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company carries a Zacks Rank #3 (Hold).
Stocks Worth a Look
Here are some medical stocks worth considering as these have the right combination of elements to post an earnings beat this quarter.
Penumbra PEN has an Earnings ESP of +11.11% and sports a Zacks Rank of 1.
Penumbra’s stock has gained 51.4% in the past six months. PEN beat earnings estimates in the last reported quarter. Penumbra has a four-quarter earnings surprise of 37.56%, on average.
ShockWave Medical SWAV has an Earnings ESP of +5.01% and a Zacks Rank #3.
ShockWave Medical’s stock has declined 39.2% in the past six months. SWAV beat earnings estimates in the last reported quarter. ShockWave Medical has a four-quarter earnings surprise of 146.10%, on average.
Nevro NVRO has an Earnings ESP of +8.35% and a Zacks Rank of 3.
Nevro’s stock has declined 31.2% in the past six months. NVRO topped earnings estimates in the last reported quarter. Nevro has a four-quarter earnings surprise of 9.19%, on average.
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West Pharmaceutical Services, Inc. (WST) : Free Stock Analysis Report
Nevro Corp. (NVRO) : Free Stock Analysis Report
Penumbra, Inc. (PEN) : Free Stock Analysis Report
ShockWave Medical, Inc. (SWAV) : Free Stock Analysis Report
