Hospira reported that revenue in the quarter increased 6.6% to $662.1 million versus $621.2 million in the year-ago quarter. Net income rose 18.7% to $77.2 million, compared with $65 million in fiscal 2004. The company was bolstered by strong sales in its specialty injectable pharmaceuticals business and its contract manufacturing services. However, Hospira expects this business will take a hit for the rest of the year, primarily because the company is winding down its distribution relationship with Schering AG
While the firm's sales may be a bit bumpy in the near term, Hospira is making concrete efforts to clean up its operations. The company has closed on a strategic agreement with ICU Medical
While there are definitely signs that Hospira is on the right track, for now the stock is fairly pricey. Investors should probably take a wait-and-see attitude.
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Fool contributor Brian Gorman is a freelance writer in Chicago. He does not own shares of any companies mentioned in this article.