AstraZeneca (AZN) Stock Down Ahead of Earnings Results

AstraZeneca (AZN) stock is declining ahead of the company's 2015 third quarter earnings results on Thursday.
By Amanda Albright ,

NEW YORK (TheStreet) -- AstraZeneca  (AZN) - Get Report  will report its 2015 third quarter earnings results before the market open on Thursday. 

Analysts surveyed by Thomson Reuters estimate that AstraZeneca will report earnings of 77 cents per share on revenue of $5.9 billion.

The London-based biopharmaceutical company reported earnings of $1.05 per share on revenue of $6.54 billion for the third quarter of 2014. 

Earlier this month, the FDA rejected the company's proposal for a diabetes drug combination. 

AstraZeneca stock was down by 0.77% to $32.06 in mid-afternoon trading on Wednesday. 

Separately, TheStreet Ratings team rates ASTRAZENECA PLC as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:

We rate ASTRAZENECA PLC (AZN) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, disappointing return on equity and weak operating cash flow.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The debt-to-equity ratio is somewhat low, currently at 0.60, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels.
  • The gross profit margin for ASTRAZENECA PLC is currently very high, coming in at 95.50%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 10.71% trails the industry average.
  • AZN, with its decline in revenue, slightly underperformed the industry average of 3.4%. Since the same quarter one year prior, revenues slightly dropped by 5.4%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. When compared to other companies in the Pharmaceuticals industry and the overall market, ASTRAZENECA PLC's return on equity is below that of both the industry average and the S&P 500.
  • Reflecting the weaknesses we have cited, including the decline in the company's earnings per share, AZN has underperformed the S&P 500 Index, declining 9.87% from its price level of one year ago. Looking ahead, other than the push or pull of the broad market, we do not see anything in the company's numbers that may help reverse the decline experienced over the past 12 months. Despite the past decline, the stock is still selling for more than most others in its industry.
  • You can view the full analysis from the report here: AZN

Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet or any of its contributors.

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