雅虎香港財經 BD (BDX) Q2 Earnings Surpass Estimates, FY24 View Revised
Becton, Dickinson and Company BDX, popularly known as BD, delivered adjusted earnings per share (EPS) of $3.17 in the second quarter of fiscal 2024, up 10.8% year over year. The figure topped the Zacks Consensus Estimate by 7.1%.
The adjustments include expenses related to purchase accounting adjustments and integration costs, among others.
GAAP EPS for the quarter was $1.85, reflecting an improvement of 20.9% from the year-earlier figure.
Revenues in Detail
BD registered revenues of $5.05 billion in the fiscal second quarter, up 4.6% year over year. The figure surpassed the Zacks Consensus Estimate by 0.3%.
At constant exchange rate (CER), revenues climbed 4.7%. The organic revenue growth for the fiscal second quarter was 5.7%.
Robust performances by all three segments drove the top-line improvement.
Segment Details
BD’s operations consist of three worldwide business segments — BD Medical, BD Life Sciences and BD Interventional.
For the quarter under review, BD Medical reported worldwide revenues of $2.45 billion, up 3.8% from the year-ago quarter on a reported basis, 3.7% at CER and 3.7% on an organic basis. Per management, this upside can be attributed to strength in Medication Management Solutions and Medication Delivery Solutions business units. This compares to our projection of fiscal second-quarter segmental revenues of $2.45 billion, in line with the company’s reported numbers.
Worldwide revenues in the BD Life Sciences segment totaled $1.30 billion, up 2.2% year over year on a reported basis, 2.3% at CER and 2.3% on an organic basis. The segment’s performance reflected strength in the Integrated Diagnostic Solutions business unit, which was partially offset by a decline in the Biosciences (BDB) unit. The fiscal second-quarter revenues compare to our estimate of $1.31 billion.
BD Interventional segment generated worldwide revenues of $1.29 billion, up 9% from the year-ago quarter on a reported basis, 9.5% at CER and 13.6% on an organic basis. The segment’s organic revenue growth was driven by performance across the segment. The fiscal second-quarter revenues compare to our estimate of $1.23 billion.
Geographic Results
In the second quarter of fiscal 2024, revenues in the United States improved 6.3% to $2.91 billion. This compares to our estimate of $2.85 billion.
International revenues grossed $2.14 billion, up 2.4% from the year-ago quarter on a reported basis and 2.6% at CER. This compares to our estimate of $2.14 billion, in line with the company’s reported numbers.
Becton, Dickinson and Company Price, Consensus and EPS Surprise
Becton, Dickinson and Company price-consensus-eps-surprise-chart | Becton, Dickinson and Company Quote
Margin Analysis
In the quarter under review, BD’s gross profit increased 3.1% to $2.30 billion. However, the gross margin contracted 69 basis points (bps) to 45.7%. We had projected 42.1% of gross margin for the fiscal second quarter.
Selling and administrative expenses decreased 0.9% to $1.19 billion. Research and development expenses decreased 11.3% year over year to $299 million. Adjusted operating expenses of $1.49 billion declined 3.2% year over year.
Adjusted operating profit totaled $812 million, reflecting a 17.2% uptick from the year-ago quarter. The adjusted operating margin in the fiscal second quarter expanded 172 bps to 16.1%.
Financial Position
BD exited second-quarter fiscal 2024 with cash and cash equivalents and short-term investments of $3.18 billion compared with $1.18 billion at the fiscal first-quarter end. Total debt (including current debt obligations) at the end of second-quarter fiscal 2024 was $18.01 billion compared with $16.11 billion at the fiscal first-quarter end.
Cumulative net cash provided by continuing operating activities at the end of second-quarter fiscal 2024 was $1.37 billion compared with $584 million a year ago.
Meanwhile, BD has a consistent dividend-paying history, with its five-year annualized dividend growth being 4.65%.
Fiscal 2024 Guidance
BD has revised its financial outlook for fiscal 2024.
BD now projects its full fiscal year revenues in the range of $20.1-$20.3 billion, lowered from the earlier projection of $20.2 billion-$20.4 billion. The Zacks Consensus Estimate is pegged at $20.29 billion.
For fiscal 2024, organic revenue growth is continued to be expected between 5.5% and 6.25%.
The revenue growth at CER is continued to be expected in the range of 4.75-5.5%.
For the full fiscal year, adjusted EPS is now anticipated to be in the range of $12.95-$13.15, representing growth of 6.1-7.7%. This is up from the earlier projection of $12.82-$13.06, representing growth of 5-7%. The Zacks Consensus Estimate is pegged at $12.94.
Our Take
BD exited the second quarter of fiscal 2024 with better-than-expected results. Solid top-line results, along with improvements in organic revenues and bottom-line performances, were impressive. Robust performances by all segments and both geographic regions were encouraging. Strength in most of BD’s segment’s business units during the reported quarter was also promising. The expansion of the adjusted operating margin bodes well.
In March, BD announced the enrollment of the first patient in the investigational device exemption study, AGILITY, which will assess the safety and effectiveness of the BD Vascular Covered Stent for the treatment of Peripheral Arterial Disease. In February, the company announced its plans to present the next installment of its BD Innovates series, which would highlight BD solutions that help clinicians treat Peripheral Vascular Disease. These look promising for the stock. The same month, BD announced a strategic partnership with Camtech Health.
In January, BD announced collaboration agreements with Hamilton and Techcyte. During the quarter, the company announced the global commercial release of the three- and four-laser additions to the BD FACSDiscover S8 Cell Sorter family, which complement the five-laser instrument launched last year. These raise our optimism about the stock.
However, the decline in BD’s BDB business unit’s Research and Clinical Solutions instruments revenues was disappointing. Rising product costs put pressure on the gross margin, leading to its contraction. This does not bode well.
Zacks Rank and Other Key Picks
BD currently carries a Zacks Rank #2 (Buy).
A few other top-ranked stocks in the broader medical space that have announced quarterly results are Align Technology, Inc. ALGN, ResMed Inc. RMD and Boston Scientific Corporation BSX.
Align Technology, carrying a Zacks Rank of 2, reported first-quarter 2024 adjusted EPS of $2.14, beating the Zacks Consensus Estimate by 8.1%. Revenues of $997.4 million outpaced the consensus mark by 2.6%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Align Technology has a long-term estimated growth rate of 6.9%. ALGN’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 5.9%.
ResMed reported third-quarter fiscal 2024 adjusted EPS of $2.13, beating the Zacks Consensus Estimate by 10.9%. Revenues of $1.19 billion surpassed the Zacks Consensus Estimate by 1.9%. It currently carries a Zacks Rank #2.
ResMed has a long-term estimated growth rate of 10.7%. RMD’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 2.8%.
Boston Scientific reported first-quarter 2024 adjusted EPS of 56 cents, beating the Zacks Consensus Estimate by 9.8%. Revenues of $3.86 billion surpassed the Zacks Consensus Estimate by 4.9%. It currently carries a Zacks Rank #2.
Boston Scientific has a long-term estimated growth rate of 12.5%. BSX’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 7.5%.
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