Hospira Second Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Hospira (NYSE:HSP) will unveil its latest earnings on Wednesday, August 1, 2012. Hospira is a global specialty pharmaceutical and medication delivery company that develops products that help improve the safety and productivity of patient care.

Hospira Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for net income of 49 cents per share, a decline of 47.9% from the company’s actual earnings for the year-ago quarter. During the past three months, the average estimate has moved down from 54 cents. Between one and three months ago, the average estimate moved down. It also has dropped from 50 cents during the last month. Analysts are projecting profit to rise by 30.6% compared to last year’s $2.11.

Past Earnings Performance: The company fell in line with estimates last quarter after topping forecasts the quarter before. After coming in above the mean estimate by 6 cents in the fourth quarter of the last fiscal year, the company fell in line with expectations by reporting profit of 47 cents per share last quarter.

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A Look Back: In the first quarter, profit fell 73.2% to $40.2 million (24 cents a share) from $149.9 million (88 cents a share) the year earlier, meeting analyst expectations. Revenue fell 3.6% to $965.9 million from $1 billion.

Stock Price Performance: Between May 30, 2012 and July 26, 2012, the stock price had risen $2.58 (8.1%), from $31.92 to $34.50. The stock price saw one of its best stretches over the last year between June 13, 2012 and June 20, 2012, when shares rose for six straight days, increasing 7.1% (+$2.29) over that span. It saw one of its worst periods between May 7, 2012 and May 15, 2012 when shares fell for seven straight days, dropping 4.2% (-$1.44) over that span.

Wall St. Revenue Expectations: On average, analysts predict $987 million in revenue this quarter, a decline of 6.9% from the year-ago quarter. Analysts are forecasting total revenue of $4.02 billion for the year, a decline of 1% from last year’s revenue of $4.06 billion.

Key Stats:

On the top line, the company is looking to get back on the right track after last quarter’s drop snapped a string of revenue increases. Revenue rose 9.9% in the second quarter of the last fiscal year, 2.9% in the third quarter of the last fiscal year and 2.2%in the fourth quarter of the last fiscal year before dropping in the first quarter.

The upcoming earnings announcement is a chance for the company to build on positive results from last quarter. The company reported losses in the third quarter of the last fiscal year and the fourth quarter of the last fiscal year, but finished in the black with income of $40.2 million in the first.

Analyst Ratings: There are mostly holds on the stock with eight of 14 analysts surveyed giving that rating.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 2.98 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands. The company regressed in this liquidity measure from 3.03 in the fourth quarter of the last fiscal year to the last quarter driven in part by an increase in liabilities. Current liabilities increased 4.3% to $884 million while assets rose 2.5% to $2.64 billion.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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