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Becton, Dickinson and Co. (BDX), Novo Nordisk A/S (ADR) (NVO): Does The Healthcare Industry Mean Stability?

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A leading medical technology company, Becton, Dickinson and Co. (NYSE:BDX)‘s earnings were better than expected. It is one of the few medical companies that is able to deliver organic growth in a challenged healthcare industry.

Becton, Dickinson and Co. (NYSE:BDX)

A decent quarter
Becton, Dickinson and Co. (NYSE:BDX) reported revenue of $2 billion for the quarter and profit of $275.6 million, beating Wall Street’s estimate by $0.04 per share. Revenue from sales in the U.S. improved slightly, but the company’s international sales surged more than 6% in comparison to the same period last year, mainly because of emerging market growth. In its medical and diagnostic segments the company reported solid 4% growth, but its bio-sciences division reported a growth of only 0.5%.
The prospects
Becton, Dickinson and Co. (NYSE:BDX) acquired Cato Software Solutions, a company that provides a portfolio of comprehensive medication safety software solutions. CSS’ services should help to prevent medication errors and improve efficiency in the pharmaceutical sector. The acquisition should add to the company’s revenue.
Furthermore, the company has entered into pharmaceutical manufacturing with Becton, Dickinson and Co. (NYSE:BDX) Simplist, for a range of ready-to-administer, pre-filled generic injectables. These injectables will be manufactured and marketed by BD Rx Inc., a wholly-owned subsidiary of Becton, Dickinson and Co. (NYSE:BDX). The company will launch 20 to 30 drugs over the span of a few years, which I believe is a smart step as they are not rushing their new manufacturing unit.
The company enjoys a dominant position in the therapy side of the market. Its needles, pens, and syringes place it in a better position to benefit from the growing number of diabetics. This reward comes with lesser reimbursement exposure and risk of competition compared to companies on the device side of diabetes.
A company that helps you fight diabetes
Pharmaceutical company Novo Nordisk A/S (ADR) (NYSE:NVO) is one of those companies which prove that being less diversified can be good too. This company concentrates on diabetes care, and produces almost half of the worlds insulin requirement with products such as Levimar, NovoRapid, and NovoMax.
The company has nine products in late stage development. These products include Turoctocog Alfa for hemophilia treatment, Liraglutide for obesity, and two new insulins, Tresiba and Ryzodeg. Novo Nordisk A/S (ADR) (NYSE:NVO) is also concentrating on a new segment, inflammation. A lot of progress in this segment has been made, with seven drugs currently in phase I and II trials.
Novo Nordisk A/S (ADR) (NYSE:NVO) yields a dividend of 1.9% and its sales have almost doubled in the last five years. The company is a good bet for investors looking to diversify their portfolio.
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