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The Medicines Company Beats on Both Top and Bottom Lines

By Seth Jayson - Updated Apr 10, 2017 at 1:45PM

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Just the facts, Fool.

The Medicines Company (Nasdaq: MDCO) reported earnings on April 24. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 31 (Q1), The Medicines Company beat expectations on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue grew significantly. Non-GAAP earnings per share increased. GAAP earnings per share contracted to a loss.

Margins dropped across the board.

Revenue details
The Medicines Company tallied revenue of $155.8 million. The eight analysts polled by S&P Capital IQ wanted to see a top line of $152.6 million on the same basis. GAAP reported sales were 23% higher than the prior-year quarter's $126.6 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.31. The four earnings estimates compiled by S&P Capital IQ forecast -$0.02 per share. Non-GAAP EPS of $0.31 for Q1 were 15% higher than the prior-year quarter's $0.27 per share. GAAP EPS were -$0.21 for Q1 compared to $0.14 per share for the prior-year quarter.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 63.6%, 590 basis points worse than the prior-year quarter. Operating margin was -14.5%, much worse than the prior-year quarter. Net margin was -7.4%, much worse than the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
Next quarter's average estimate for revenue is $168.0 million. On the bottom line, the average EPS estimate is $0.48.

Next year's average estimate for revenue is $680.8 million. The average EPS estimate is $1.58.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 143 members out of 161 rating the stock outperform, and 18 members rating it underperform. Among 41 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 36 give The Medicines Company a green thumbs-up, and five give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on The Medicines Company is outperform, with an average price target of $35.18.

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