Watson Pharmaceuticals Inc. Fourth Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Watson Pharmaceuticals, Inc. (NYSE:WPI) will unveil its latest earnings on Tuesday, February 14, 2012. Watson Pharmaceuticals develops, manufactures, markets, sells and distributes pharmaceutical products.

Watson Pharmaceuticals, Inc. Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for net income of $1.75 per share, a rise of 88.2% 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 $1.61. Between one and three months ago, the average estimate was unchanged. It has risen during the last month. For the year, analysts are projecting profit of $4.76 per share, a rise of 46.9% from last year.

Past Earnings Performance: Last quarter, the company reported net income of $1.09 per share versus a mean estimate of profit of. The company has beaten estimates for the past three quarters.

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Wall St. Revenue Expectations: On average, analysts predict $1.54 billion in revenue this quarter, a rise of 61.6% from the year ago quarter. Analysts are forecasting total revenue of $4.58 billion for the year, a rise of 28.3% from last year’s revenue of $3.57 billion.

Analyst Ratings: 13 out of 22 analysts surveyed (59.1%) have a buy rating on Watson Pharmaceuticals.. This is below the mean analyst rating of 10 competitors, which average 65.2% buy ratings. Over the past 90 days, the average rating for the stock has moved up from hold to moderate buy.

A Look Back: In the third quarter, profit rose more than twofold to $68.1 million (54 cents a share) from $25.7 million (21 cents a share) the year earlier, exceeding analyst expectations. Revenue rose 22.6% to $1.08 billion from $882.4 million.

Key Stats:

The increase in profit in the third quarter broke a streak of three consecutive quarters of year-over-year profit decreases. Net income dropped 25.4% in the second quarter, 35.1% in the first quarter and 67.8% in the fourth quarter of the last fiscal year.

Revenue has risen the past four quarters. Revenue rose 23.6% in the second quarter from the year earlier, climbed 2.3% in the first quarter from the year-ago quarter and 21.3% in the fourth quarter of the last fiscal year.

Stock Price Performance: During November 10, 2011 to February 8, 2012, the stock price had fallen $7.50 (-11.5%) from $65.40 to $57.90. The stock price saw one of its best stretches over the last year between September 12, 2011 and September 20, 2011 when shares rose for seven-straight days, rising 9.6% (+$6.31) over that span. It saw one of its worst periods between July 22, 2011 and August 2, 2011 when shares fell for eight-straight days, falling 8% (-$5.67) over that span.

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

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