NEW YORK (TheStreet) -- Shares of Valeant Pharmaceuticals (VRX) were falling in mid-afternoon trading on Monday as JPMorgan said the stock is one to avoid ahead of its 2016 third quarter earnings report due next month, according to Barron's.
The firm said that it expects Quebec-based Valeant to reduce its outlook for full-year earnings per share below the company's current estimate of $6.60 per share to $7.00 per share.
JPMorgan anticipates earnings of $6.39 per share for the full year, lower than consensus projections of $6.48 per share.
"While a cut to guidance is widely expected based on recent prescription trends and following a new CFO announcement, we still see an uncertain growth outlook for several of the company's key segments (most notably gastrointestinal and dermatology)," JPMorgan added, Barron's reports.
This uncertainty could "overshadow" any upcoming asset sales or gradual deleveraging, the firm said.
For the specialty pharmaceuticals segment in general, JPMorgan said it anticipates earnings volatility in the third quarter "as sentiment remains bearish and fundamentals, although set to improve into 2017 in our view, remain uncertain in the near term."
Valeant will report third-quarter results before the opening bell on November 8.
Analysts are looking for adjusted earnings of $1.76 per share on revenue of $2.52 billion for the quarter. Valeant reported adjusted earnings of $2.74 per share on $2.79 billion in revenue in the year-ago period.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
TheStreet Ratings rated this stock as a "sell" with a ratings score of D.
The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, generally high debt management risk, disappointing return on equity, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.
You can view the full analysis from the report here: VRX