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The first-quarter 2025 earnings season for the Medical sector is about to pick up pace this week. The sector mainly comprises pharma/biotech and medical device companies. The earnings season for the drug and biotech sector was kicked off last week when bellwether Johnson & Johnson reported strong first-quarter results, beating the estimates for its earnings and sales. JNJ also slightly raised its sales guidance range for the year. Most of the remaining large-cap pharmaceutical companies will report their first-quarter results by the end of April. (Find the latest earnings estimates and surprises on Zacks Earnings Calendar.)
Per the Earnings Trends report, as of April 16, 3.3% of the companies in the Medical sector — representing 11.3% of the sector’s market capitalization — reported quarterly earnings. Of these, 100% surpassed earnings estimates, while 50% beat the same for revenues. Earnings increased 3.8% year over year, while revenues rose 2.9%. Overall, first-quarter earnings of the Medical sector are expected to increase 34.7%, while sales are projected to rise 7.5% from the year-ago quarter.
Gilead Sciences GILD, Bristol Myers BMY, Merck MRK, AbbVie ABBV and Sanofi SNY are all slated to release theirquarterly results later this week.
Let’s see how these pharma bigwigs are likely to have performed in the soon-to-be-reported quarter.
Gilead has an impeccable earnings track record so far. It beat earnings estimates in each of the last four quarters, delivering an average surprise of 19.47%. In the last reported quarter, GILD beat earnings estimates by 13.77%.
Per our proven model, companies with the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) have a good chance of delivering an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
For the first quarter of 2025, Gilead has an Earnings ESP of +3.07% and a Zacks Rank #3, indicating a likely positive surprise. The Zacks Consensus Estimate for GILD’s earnings is pegged at $1.73 per share. You can see the complete list of today’s Zacks #1 Rank stocks here.
Gilead’s flagship HIV therapies — Biktarvy and Descovy — are likely to have boosted the company’s top line. However, the company’s revenues are likely to have been impacted by the new Medicare Part D model, which increases manufacturer discount obligations during the initial coverage and catastrophic phases and offers additional discounts for people who qualify for the low-income subsidy program, a group significantly affected by HIV.
Gilead is slated to report its first-quarter 2025 earnings results on April 24, after market close.
Gilead Sciences, Inc. price-consensus-chart | Gilead Sciences, Inc. Quote
Bristol Myers also has an excellent earnings track record. BMY’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 16.18%. In the last reported quarter, Bristol Myers’ earnings surpassed estimates by 14.38%.
For the quarter to be reported, Bristol Myers has an Earnings ESP of -0.51% and a Zacks Rank #3. The Zacks Consensus Estimate for BMY’s earnings is pegged at $1.54 per share.
Bristol Myers’ revenues in the first quarter of 2025 are likely to have been impacted by a decline in sales from its legacy drugs, which include Eliquis, Revlimid, Pomalyst, Sprycel and Abraxane, among others. However, the expected decline has likely been partially offset by an increase in the sales of BMY’s growth products like Opdivo, Yervoy, Reblozyl, Breyanzi, Zeposia, Opdualag and others.
Bristol Myers is scheduled to report its quarterly earnings results on April 24, before the opening bell.
Bristol Myers Squibb Company price-consensus-chart | Bristol Myers Squibb Company Quote
Merck has an encouraging earnings track record. It beat earnings estimates in each of the last four quarters, delivering an average earnings surprise of 4.68%. In the last reported quarter, MRK beat earnings estimates by 1.78%.
For the quarter to be reported, Merck has an Earnings ESP of -2.04% and a Zacks Rank #3. The Zacks Consensus Estimate for MRK’s earnings is pegged at $2.16 per share.
Merck’s revenue growth in the first quarter is likely to have been fueled by the continued strong performance of its cancer drug Keytruda, as seen in previous quarters, supported by expanded indications and growing patient demand. However, ex-U.S. sales of MRK’s popular HPV vaccine, Gardasil, are expected to have been hurt by lower demand in China due to unfavorable economic conditions.
Merck is slated to report its quarterly earnings results on April 24, before the opening bell.
Merck & Co., Inc. price-consensus-chart | Merck & Co., Inc. Quote
AbbVie has an impeccable earnings track record to date. ABBV’s earnings beat estimates in each of the trailing four quarters, delivering an average earnings surprise of 2.37%. In the last reported quarter, AbbVie’s earnings beat estimates by 1.41%.
For the quarter to be reported, AbbVie has an Earnings ESP of -3.61% and a Zacks Rank #3. The Zacks Consensus Estimate for ABBV’s earnings is pegged at $2.47 per share.
AbbVie’s top line is expected to have been driven by robust sales of key drugs Rinvoq, Skyrizi, Venclexta and Vraylar, coupled with significant contributions from newer drugs, namely Ubrelvy, Elahere, Epkinly and Qulipta.
ABBV is slated to report its quarterly earnings results on April 25, before the opening bell.
AbbVie Inc. price-consensus-chart | AbbVie Inc. Quote
Sanofi has a mixed earnings record so far. It beat earnings estimates in two of the last four quarters, matched once and missed the mark on the remaining occasion, delivering an average earnings surprise of 5.14%. In the last reported quarter, SNY missed earnings estimates by 1.41%.
For the quarter to be reported, Sanofi has an Earnings ESP of +1.62% and a Zacks Rank #3. The Zacks Consensus Estimate for SNY’s earnings is pegged at 90 cents per share.
In the upcoming earnings release, Sanofi’s revenues are likely to have been driven by higher sales of Dupixent and contributions from new products like AstraZeneca-partnered Beyfortus and Altuviiio. However, the company’s lower flu vaccine sales, along with the generic competition on Aubagio sales in all key markets, are likely to have hurt sales.
Sanofi is scheduled to report its quarterly earnings results on April 24, before the opening bell.
Sanofi price-consensus-chart | Sanofi Quote
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This article originally published on Zacks Investment Research (zacks.com).
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