Salix Pharmaceuticals Earnings Preview

Salix Pharmaceuticals (Nasdaq: SLXP  ) will try to beat its earnings estimates for the fifth consecutive quarter. The company will unveil its latest earnings on Monday, Feb. 27. Salix Pharmaceuticals is a specialty pharmaceutical company dedicated to acquiring, developing, and commercializing prescription drugs used in the treatment of a variety of gastrointestinal diseases.

What analysts say:

  • Buy, sell, or hold?: Analysts strongly back Salix Pharmaceuticals, with 12 of 16 rating it a buy and the remainder rating it a hold. Analysts don't like Salix Pharmaceuticals as much as competitor Progenics Pharmaceuticals overall. While analysts still rate the stock a moderate buy, they are a little more optimistic about it compared to three months ago.
  • Revenue forecasts: On average, analysts predict $152.6 million in revenue this quarter. That would represent a rise of 28.8% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.97 per share. Estimates range from $0.88 to $1.08.

What our community says:
CAPS All-Stars are solidly supporting the stock, with 89.6% giving it an "outperform" rating. The community at large agrees with the All-Stars, with 83.2% awarding it a rating of "outperform." Salix Pharmaceuticals' bearish CAPS rating of two out of five stars falls short of the Fool community sentiment.

Management:

Now, a look at how efficient management has been at running the business. Margins illustrate how efficiently a company captures portions of sales dollars. Salix Pharmaceuticals has seen rising net margin year over year for the last four quarters. Net margin reflects what percentage of each dollar earned by the company becomes profit. Here are Salix Pharmaceuticals' reported margins for the last four quarters:

Quarter

Q3

Q2

Q1

Q4

Gross Margin

83.6%

81.0%

82.4%

77.0%

Operating Margin

36.3%

23.2%

7.0%

28.0%

Net Margin

23.4%

14.5%

0.3%

20.7%

One final thing: If you want to keep tabs on Salix Pharmaceuticals movements, and for more analysis on the company, make sure you add it to your Watchlist.

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Earnings estimates provided by Zacks.

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