Why Express Scripts Lost Big Today

Express Scripts (NASDAQ: ESRX  ) fell 4% today, a big fall for a $60 billion company, after it delivered its fourth-quarter earnings. While the company's revenue and adjusted earnings were just in line with expectations, and guidance landed right around what analysts were estimating, as well, the market clearly reacted today to a few disturbing trends within the company.

Revenue for ESRX has declined both year over year for the last two quarters, as well as sequentially, in three out of the past four. While the company has seen earnings per share increase, this was largely due to share buybacks, which are expected to continue. David notes that organic script growth is in decline in 2014, and in this segment from Friday's Market Checkup, he notes that he'll be digging into comments from the company regarding Obamacare, how that legislation is changing its relationships, and if the company plans to keep growing through acquisitions.

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  • Report this Comment On February 26, 2014, at 9:17 AM, kkodre wrote:

    David you have no idea what you are talking about.. This is the difference between you and Warren Buffett. You are a spreadsheet man while Warren looks at business. Not just in spreadsheets but sometimes literally/physically with his own eyes...

    Anyways, people who follow ESRX closely, know that after the MEDCO purchase, a slight loss of revenue was expected in the near term.. Look at the business not from Quarters(Spreadsheet) point of view but rather from long term business ownership....

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David Williamson

The Motley Fool's Healthcare Analyst, I specialize in Pharma, Biotech, and how the ACA (Obamacare) is changing the business of healthcare in America. Follow me on Twitter for breaking stock news, policy thoughts, and misc musings...

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9/3/2015 1:00 PM
ESRX $84.04 Up +0.55 +0.66%
Express Scripts CAPS Rating: *****