Last Friday, Zacks released a new report were it reconfirmed its neutral rating for Amgen, Inc. (NASDAQ:AMGN). This company is the world’s largest independent biotechnology firm, dedicated to the discovery, development, manufacturing and delivery of innovative human therapeutics. According to Zacks, Amgen, Inc. (NASDAQ:AMGN) “reported second quarter EPS of $1.88, up 3.3% and 17 cents above the Zacks Consensus Estimate. Revenues increased 5% to $4.7 billion, topping the Zacks Consensus Estimate of $4.5 billion”.
At a first glance Amgen, Inc. (NASDAQ:AMGN)’s second quarter might look rather remarkable with the company beating estimates by a huge margin. Nevertheless, Zacks argues that revenues “included a positive Medicaid adjustment impact which boosted the bottom line by 16 cents”. Also, a lower tax rate and share count have benefited the company’s earnings.
On the long term, the company should be able to deliver on its expansion in key markets-based strategy. With new partners such as GlaxoSmithKline and Daiichi Sankyo, the company will be able to expand to Japan, Europe, Australia, New Zealand and Mexico, as well as China, India, Brazil and Taiwan were the firm does not have a commercial presence. It has also acquired the Turkish firma Mustafa Nevzat Pharmaceuticals, expanding its horizons to Turkey and other rapidly growing markets, as stated by Zacks. All in all, Amgen, Inc. (NASDAQ:AMGN) expects to have a presence in 75 countries by 2015 and to generate more than $1 billion in sales from their presence in this new emerging markets.
The company’s growth also relies on the launch of new manufacturing technologies and on the development of its pipeline. In March 2012 Amgen acquired the biotech company Micromet, Inc. for close to $1.16 billion, which expanded its oncology pipeline. In last August, Amgen, Inc. (NASDAQ:AMGN) entered into a deal to acquire the firm Onyx. This acquisition represents a fresh influx of products into its pipelines that will also help make up for a part of the revenues lost to generic competition. Also it will strengthen the company’s presence in the oncology market.
This last acquisition, altogether with the company’s healthy growing dividend, could make Amgen a solid investment in the long term. Zacks expects the years 2013 and 2014 to be important for the company. They are expected to show results on several key pipeline candidates that –if successful– will continue to make this firm one of the most committed to advancing science to effectively improve the lives of people.
Disclosure: Pamela Gaviño holds no position in any stocks mentioned
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