No Earnings Face-Lift Needed For Allergan

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When I was growing up, my mom always told me that if I wanted to get rich, I should be a plastic surgeon. Perhaps she knew about ophthalmic and plastic surgery product developer Allergan (NYSE: AGN). The company's shares have made many investors quite wealthy, climbing more than 1,600% since 1990 with hit products such as Botox and the Restasis eye-drop treatment. Continuing its rapid growth, Allergan released its fourth-quarter and full-year 2006 financial results today.

Not including sales associated with the Inamed acquisition back in 2005, revenue was up nearly 16% for the quarter. Sales of Allergan's Botox treatment jumped 20% to $273 million for the quarter. Gross margins were 83%, and operating margins stayed a sky-high 21% on a GAAP basis. Adjusted earnings per share were basically flat compared to the prior-year period.

Besides stringing together another good quarter of organic sales growth, Allergan had a couple of regulatory wins this quarter. Shares saw an increase in November when the FDA approved its silicone breast implants for marketing, and in December, Allergan received an approvable letter for its eye-care product COMBIGAN.

Allergan did a good job of providing very detailed financial guidance for the coming year (although boo to it for not releasing a statement of cash flows at this time). In 2007, sales are expected to climb at least 13%, and adjusted earnings-per-share gains will be in the 16% to 18% range. The nice thing about investing in shares of Allergan is that it derives most of its revenue from products like its eye-care pharmaceuticals, which will stay in demand whether the economy is in recession or boom.

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Fool contributor Brian Lawler does not own shares of any company mentioned in this article. The Fool has a disclosure policy.