Jazz Pharmaceuticals Third Quarter Earnings Sneak Peek

Jazz Pharmaceuticals plc (NASDAQ:JAZZ) will unveil its latest earnings on Thursday, November 8, 2012. Jazz Pharmaceuticals is a specialty pharmaceutical company, which is focused on developing and commercializing innovative products to meet unmet medical needs in neurology and psychiatry.

Jazz Pharmaceuticals plc Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for net income of $1.20 per share, a rise of 37.9% from the company’s actual earnings in the year-ago quarter. During the past three months, the average estimate has moved up from $1.19. Between one and three months ago, the average estimate moved up. It has been unchanged at $1.20 during the last month. For the year, analysts are projecting profit of $4.45 per share, a rise of 42.2% from last year.

Past Earnings Performance: The company is looking to make a streak of three quarters of beating estimates. Last quarter, it beat expectations by reporting net income of $1.01 per share, and the previous quarter, it had profit of 86 cents.

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Wall St. Revenue Expectations: Analysts are projecting a rise of more than twofold in revenue from the year-earlier quarter to $179.6 million.

Stock Price Performance: Between September 7, 2012 and November 2, 2012, the stock price had risen $9.59 (21.5%), from $44.56 to $54.15. The stock price saw one of its best stretches over the last year between June 11, 2012 and June 19, 2012, when shares rose for seven straight days, increasing 12.4% (+$5.12) over that span. It saw one of its worst periods between May 11, 2012 and May 18, 2012 when shares fell for six straight days, dropping 15.9% (-$8.02) over that span.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.56 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term. The company regressed in this liquidity measure from 3.13 in the first quarter to the last quarter driven in part by an increase in liabilities. Current liabilities increased 83.9% to $192.3 million while assets decreased 8.2% to $300.4 million.

Key Stats:

With double-digit revenue growth the past four quarters, this earnings release is a chance to keep that positive trend going. The company has averaged year-over-year revenue growth of 83.5% over the last four quarters.

After last quarter’s profit drop broke a string of income increases, this earnings announcement is definitely a chance for a rebound. Net income rose more than twofold in the third quarter of the last fiscal year, 53.2% in the fourth quarter of the last fiscal year and 26.8% in the first quarter before declining in the second quarter.

The company’s gross margin shrank by 6.6 percentage points in the in the second quarter. Revenue rose 100.6% while cost of sales rose 356.1% to $15.4 million from a year earlier.

A Look Back: In the second quarter, profit fell 18.2% to $27.1 million (45 cents a share) from $33.2 million (71 cents a share) the year earlier, but exceeded analyst expectations.

Analyst Ratings: With nine analysts rating the stock a buy, none rating it a sell and none rating the stock a hold, there are indications of a bullish stance by analysts.

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

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