CHICAGO, July 28, 2011 /PRNewswire/ -- Zacks.com announces
the list of stocks featured in the Analyst Blog. Every day the
Zacks Equity Research analysts discuss the latest news and events
impacting stocks and the financial markets. Stocks recently
featured in the blog include Mylan Inc. (Nasdaq: MYL),
AstraZeneca (NYSE: AZN), Novartis (NYSE: NVS),
Cephalon (Nasdaq: CEPH) and Moody's Corp. (NYSE:
MCO).
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Here are highlights from Wednesday's Analyst Blog:
Mylan Beats on All
Fronts
Mylan Inc.'s (Nasdaq: MYL) second quarter 2011 earnings
(excluding special items) of 52 cents
per share were above the Zacks Consensus Estimate of 45 cents as well as the year-ago earnings of
37 cents per share. Earnings growth
was driven by increase in generics revenue and improved gross
margins.
Quarter in Detail
Total revenues at Mylan climbed 15% over the prior year to
$1.57 billion driven by increased
sales of generic drugs and the positive impact of foreign exchange
(Fx). Revenues were also ahead of the Zacks Consensus Estimate of
$1.50 billion. Total revenues
comprise both net revenues and other revenues from third
parties.
Mylan reports revenues through two segments: Generics and
Specialty.
Generic third party net sales, derived from sales in
North America, Europe, Middle
East & Africa (EMEA),
and the Asia Pacific, climbed
about 17% to $1.44 billion in the
second quarter of 2011. Third party net sales declined in EMEA on a
constant currency basis, but grew in other markets like
Asia-Pacific and North America.
Third party net sales in North American markets rose 27.2% to
$749.1 million in the reported
quarter. The increase was mainly attributable to new product
launches, the important ones being the generic versions of
AstraZeneca's (NYSE: AZN) Entocort, Novartis' (NYSE:
NVS) Femara and Cephalon's (Nasdaq: CEPH) Amrix. Results
were aided by the September 2010
purchase of Bioniche Pharma.
Third party net sales from the EMEA market of $378.7 million remained flat year over year,
benefiting from the positive impact of Fx. Excluding the positive
impact of Fx, sales in EMEA reported a decline, mainly attributable
to increased competition resulting in lower pricing and volume in
some European markets like Germany
and France. However, Italy did well in the quarter.
Third party net sales in Asia-Pacific spurred 17.2% to $310.9 million, driven by increased sales of
anti-retroviral finished dosage products and active pharmaceutical
ingredients (API) from the company's Indian subsidiary, Matrix.
Foreign exchange benefit, to the tune of 10%, was a major
catalyst.
Third party net sales from the Specialty division climbed 6.2%
to $131.7 million, boosted by pricing
benefits of the EpiPen Auto-Injector and volume growth of the
Perforomist Solution.
Adjusted gross margins improved to 48% (from 45% in the
prior-year quarter), mainly due to new product launches in
North America coupled with
favorable pricing for EpiPen.
Moody's Tops Zacks Consensus
Moody's Corp. (NYSE: MCO) reported strong second quarter
2011 earnings, beating the Zacks Consensus Estimate of 57 cents by 22
cents (up 38.6%).
Moody's reported pro forma earnings of 79
cents per share, up 61.2% year over year compared with
49 cents per share in the prior-year
quarter. The positive surprise was primarily driven by strong
revenues, which comprehensively beat the Zacks Consensus
Estimate.
Based on the strong results, Moody's revised its full-year
earnings per share guidance.
Operating Performance
Operating income, excluding restructuring charges and legacy
tax, came in at $270.0 million in the
second quarter, up 41.5% year over year. Operating margin increased
470 basis points (bps) on a year-over-year basis to 44.6% in the
quarter.
On a dollar basis, operating expenses increased 16.8% year over
year to $287.0 million, primarily due
to increased headcount, higher incentive compensation and higher
technology spending.
Moody's effective tax rate was 27.8% in the quarter versus 31.1%
in the prior-year quarter.
Net income increased 56.0% year over year to $181.9 million, with net margin surging 560 bps
year over year to 30.1%.
2011 Guidance
Based on better-than-expected second quarter results, Moody's
revised its fiscal 2011 guidance. For fiscal 2011, Moody's expects
revenue to increase in the low-teens percentage range (previous
guidance was in the low-double-digit percentage range). However,
expenses are expected to increase in the low-double-digit
percentage range.
Management expects operating margin in the range of 38% to 40%
and the effective tax rate to be approximately 33.0% for fiscal
2011.
Management intends to continue with its share repurchase program
in 2011, subject to available cash flow and other capital
allocation decisions.
The company expects diluted earnings per share for fiscal 2011
in the range of $2.38 to $2.48
(previous guidance was $2.22 to
$2.32). Currently, the Zacks Consensus Estimate is pegged at
$2.34 for fiscal 2011.
Segment wise, global MIS revenue is expected to increase in the
low-teens percentage range (previous guidance low-double-digit
percentage range) for fiscal 2011. Domestic MIS revenue is expected
to increase in the high single-digit percentage range, while
overseas revenue is expected to increase in the low-twenties
percentage range.
Corporate finance revenue is anticipated to increase in the
mid-twenties percentage range. Structured finance revenue is
projected to grow in the high-single-digit percentage range.
Revenue from financial institutions is expected to grow in the
high-single-digit percentage range, while public, project and
infrastructure finance revenue is estimated to be flat on a
year-over-year basis.
MA revenue is likely to increase in the low-double-digit
percentage range for fiscal 2011. MA revenue in the U.S is expected
to increase in the low-double-digit percentage range and in the
low-double-digit percentage range outside the U.S.
Revenue growth is expected in the mid-single-digit percentage
range for Research, Data and Analytics and in the low- to
mid-single-digit percentage range for Risk Management software.
Professional services revenue is expected to double in 2011, driven
by revenue generated from the acquisition of CSI Global Education
in late 2010.
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