NEW YORK (
reported earnings of 60 cents, a penny above the Street, and revenue of $11.3 billion, in line with the Street, after the markets closed on Wednesday.
The pharmacy benefits manager (PBM) is staging something of a comeback on Thursday morning after suffering through several recent days of negative headlines that led to derivative sell trades of the PBM stock.
Shares of Express Scripts were up more than 5% as its earnings conference call was taking place on Thursday morning. The early rise on Thursday, and elevated trading -- Express Scripts was nearing its average daily volume of six million shares in the morning -- may be a comeback, but shares are still climbing their way out from a big 2010 hole. So it's a comeback from a big sell-off, more or less.
Express Scripts Stock Rating Report (ESRX) Rating and Financial Analysis
Express Scripts shares were down 14% this year, through Wednesday. In after-hours trading shares dipped as much as 10% initially -- after losing 2.7% in regular trading -- but those losses were pared back to 2.5% in the after-hours session.
It was a tough day for Express Scripts on Wednesday, ahead of its after-market earnings, with an announcement from
that it was partnering with
sending PBM stocks down, including Express Scripts and its closest rival
Medco Health Solutions
Medco is down 15% this year, and the response to its earnings was all about the outlook. In addition to the weakening generic drug pipeline, there are immediate concerns about the macroeconomic environment continuing to serve as a drag on health care.
Express-Scripts has been caught up in a spate of negative headlines, with Wal-Mart recently selecting Medco to run its pharmacy benefit manager business. Additionally, in the recent Medco earnings, the Medco management decision to provide no visibility on 2011 sales sent the PBM stocks tumbling. There is already widespread expectation that 2011 will be a weaker year for the PMB stocks.
While Express Scripts' profit rose to $289.9 million from $192.3 million last year, and earnings rose to 60 cents from 45 cents, gross margin fell from 10.8% to 6.7%. The revenue doubling from last year was driven by an acquisition of
Express Scripts didn't provide much of an outlook ahead of its earnings call, either. "We remain positive on the underlying trends and opportunities in our space and remain confident in our ability to improve health outcomes and drive out waste -- meeting the needs of our clients, lowering costs and generating exceptional shareholder value," said George Paz, president, chief executive officer and chairman.
There was also a minor change in earnings guidance for the full year. Express Scripts expected a low-end EPS of $2.42, but has raised that low-end to $2.45.
Express-Scripts will hold its earnings conference call on Thursday morning.
-- Written by Eric Rosenbaum from New York.
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