Express Scripts (ESRX) rose Tuesday after guiding 2007 earnings above the Wall Street analyst consensus.
The St. Louis-based pharmacy-benefit manager said it expects to make $3.90 to $4.02 a share, above the $3.84 Thomson Financial target. Express Scripts said it believes its financial performance will continue to benefit from growth in generic utilization, home delivery and specialty pharmacy management; lower retail and home-delivery drug-purchasing costs; improved formulary compliance with preferred, lower-cost brand drugs; increased productivity; and capital structure improvements.
The company said its guidance includes an allowance for a potential impact arising from possible changes to average wholesale prices as contemplated by the settlement proposed by First DataBank in a civil class-action lawsuit. "Approximately 92% of Express Scripts' contracts with clients contain terms that the company believes will enable it to mitigate the adverse effect of this potential reduction in FDBs reported AWP," Express Scripts said. "However, the company cannot predict the precise timing of any AWP changes or predict with certainty the effect these changes may have upon the company."
Shares rose $2.02 to $67.98.