Cephalon, Inc. Second Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Cephalon, Inc. (NASDAQ:CEPH) will unveil its latest earnings on Tuesday, August 2, 2011. Cephalon, Inc.is an international biopharmaceutical company that develops products to address central nervous system, pain, oncology and inflammatory disease.

Cephalon, Inc. Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for net income of $2.08 per share, a rise of 1.5% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from $2.10. Between one and three months ago, the average estimate moved down, but has risen from $2.07 during the last month. For the year, analysts are projecting profit of $8.35 per share, a rise of 2.6% from last year.

Past Earnings Performance: The company missed estimates last quarter after beating forecasts in the prior two. In the first quarter, the company reported net income of $1.98 per share versus a mean estimate of profit of $2.04 per share. In fourth quarter of the last fiscal year, the company beat estimates by 27 cents.

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Wall St. Revenue Expectations: On average, analysts predict $764.4 million in revenue this quarter, a rise of 5.2% from the year ago quarter. Analysts are forecasting total revenue of $3.08 billion for the year, a rise of 9.6% from last year’s revenue of $2.81 billion.

Analyst Ratings: Analysts seem relatively indifferent about Cephalon with 18 of 21 analysts surveyed maintaining a hold rating.

Key Stats:

The company has enjoyed double-digit year-over-year percentage revenue growth for the past four quarters. Over that span, the company has averaged growth of 30.5%, with the biggest boost coming in the fourth quarter of the last fiscal year when revenue rose 34% from the year earlier quarter.

The company’s gross margin shrank by 3.6 percentage points in the in the first quarter. Revenue rose 24.9% while cost of sales rose 50.4% to $158 million from a year earlier.

Competitors to Watch: Watson Pharmaceuticals, Inc. (NYSE:WPI), Valeant Pharmaceuticals Int (NYSE:VRX), Genzyme Corporation (NASDAQ:GENZ), Johnson & Johnson (NYSE:JNJ), Jazz Pharmaceuticals, Inc. (NASDAQ:JAZZ), ChemGenex Pharmaceuticals Ltd. (CXSPY), Teva Pharmaceutical Industries Ltd (NASDAQ:TEVA), Bristol Myers Squibb Co. (NYSE:BMY), Abbott Laboratories (NYSE:ABT), and Biogen Idec Inc. (NASDAQ:BIIB).

Stock Price Performance: During May 31, 2011 to July 27, 2011, the stock price had risen 47 cents (0.6%) from $79.69 to $80.16. The stock price saw one of its best stretches over the last year between October 19, 2010 and October 28, 2010 when shares rose for eight-straight days, rising 4.5% (+$2.88) over that span. It saw one of its worst periods between December 21, 2010 and December 31, 2010 when shares fell for eight-straight days, falling 4.7% (-$3.02) over that span. Shares are up $18.44 (+29.9%) year to date.

(Source: Xignite Financials)

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