Amgen’s Second Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Amgen (NASDAQ:AMGN) will unveil its latest earnings on Thursday, July 26, 2012. Amgen is a biotechnology medicines company that discovers, develops, manufactures, and markets medicines for grave illnesses.

Amgen Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for net income of $1.51 per share, a rise of 11.9% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved up from $1.49. Between one and three months ago, the average estimate moved up. It has been unchanged at $1.51 during the last month. For the year, analysts are projecting profit of $6.08 per share, a rise of 16% from last year.

Last quarter, the company came in at net income of $1.59 per share against a mean estimate of profit of $1.43 per share, beating estimates after missing them in the previous quarter. In the fourth quarter of the last fiscal year, it missed forecasts by 5 cents.

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Stock Price Performance: Between May 23, 2012 and July 23, 2012, the stock price had risen $8.62 (12.51%), from $68.91 to $77.53. The stock price saw one of its best stretches over the last year between December 12, 2011 and December 27, 2011, when shares rose for 11 straight days, increasing 12.7% (+$7.26) over that span. It saw one of its worst periods between November 10, 2011 and November 21, 2011 when shares fell for eight straight days, dropping 5.2% (-$2.99) over that span.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 3.24 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 4.8 in the fourth quarter of the last fiscal year to the last quarter driven in part by an increase in liabilities. Current liabilities increased 44.2% to $8.3 billion while assets decreased 2.7% to $26.86 billion.

A Look Back: In the first quarter, profit rose 5.2% to $1.18 billion ($1.48 a share) from $1.13 billion ($1.20 a share) the year earlier, exceeding analyst expectations. Revenue rose 9.2% to $4.05 billion from $3.71 billion.

Key Stats:

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 4.1% in the second quarter of the last fiscal year, 3.4% in the third quarter of the last fiscal year and 3.4% in the fourth quarter of the last fiscal year before increasing again in the first quarter.

After some good news last quarter, the company is trying to build on the result with this upcoming earnings announcement. Net income fell in the second quarter of the last fiscal year, the third quarter of the last fiscal year and the fourth quarter of the last fiscal year before snapping that run with a profit increase in the first quarter.

Wall St. Revenue Expectations: On average, analysts predict $4.08 billion in revenue this quarter, a rise of 3% from the year-ago quarter. Analysts are forecasting total revenue of $16.38 billion for the year, a rise of 5.1% from last year’s revenue of $15.58 billion.

Analyst Ratings: There are mostly holds on the stock with 12 of 23 analysts surveyed giving that rating.

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

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