Mead Johnson Nutrition Company Earnings: Two Quarters in a Row of Rising Profit

S&P 500 (NYSE:SPY) component Mead Johnson Nutrition Company (NYSE:MJN) reported net income above Wall Street’s expectations for the second quarter. Mead Johnson Nutrition provides pediatric nutrition and related products which help improve the health and development of infants and children around the world.

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Mead Johnson Nutrition Company Earnings Cheat Sheet

Results: Net income for Mead Johnson Nutrition Company rose to $165.8 million (81 cents per share) vs. $132.1 million (64 cents per share) in the same quarter a year earlier. This marks a rise of 25.5% from the year-earlier quarter.

Revenue: Rose 8.6% to $1.01 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Mead Johnson Nutrition Company reported adjusted net income of 83 cents per share. By that measure, the company beat the mean estimate of 76 cents per share. Analysts were expecting revenue of $1 billion.

Quoting Management: “Our sales and earnings growth continued to be strong in the second quarter,” said Chief Executive Officer Stephen W. Golsby. “Sales growth was broad-based across Asia and Latin America and included the first full-quarter from our Argentine acquisition. The majority of markets in this segment reported double-digit growth on a constant dollar basis. China/Hong Kong continued to deliver strong sales growth; however, we expect lower growth in the second half of the year in light of recent data indicating both a slowdown in the China category and a decline in Mead Johnson’s market share. In the North America/Europe segment, we saw a significant improvement in the U.S. business compared to the first quarter.”

Key Stats:

The company has now surpassed analyst estimates for four quarters in a row. It beat the mark by 4 cents in the first quarter, by one cent in the fourth quarter of the last fiscal year, and by one cent in the third quarter of the last fiscal year.

Revenue has risen for the last four quarters. Revenue increased 9.6% to $986.6 million in the first quarter. The figure rose 13.4% in the fourth quarter of the last fiscal year from the year earlier and climbed 15.3% in the third quarter of the last fiscal year from the year-ago quarter.

Net income has increased 13.8% year-over-year on average across the last five quarters. The biggest gain came in the third quarter of the last fiscal year, when income climbed 36.4% from the year-earlier quarter.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the third quarter has moved down from 82 cents a share to 80 cents over the last thirty days. Over the past sixty days, the average estimate for the fiscal year has reached $3.13 per share, a decline from $3.16.

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

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