Becton Dickinson & Co. (NYSE:BDX) is at its lowest valuation since 1993, making it ripe for a buyout, after reporting dismal third-quarter results last week.
The company posted a 24 percent profit slide for the quarter Nov. 2, sending shares down 4.6 percent to a close of $72.60 that day.
The stock’s $72.38 close the following day knocked its valuation down to 12.4 times estimated earnings this fiscal year, according to Bloomberg – its cheapest point in nearly two decades.
“Becton is an undervalued company with a tremendous franchise,” Hank Smith, chief investment officer at Haverford Trust, told the news service. “If Becton gets too much cheaper than this, it might very well find itself an acquisition target.”
BDX could fetch more than $90 a share in a takeover, Smith added – as of about 3 p.m. today, a 20.6 percent premium over its $74.65 price.
Q3 profits push Abiomed to 52-week high
Shares of Abiomed (NSDQ:ABMD) hit a 52-week high Friday after the company posted its first profitable quarter, surging 12.5 percent to $20 per share before subsiding to an $18.73 close – up 5.4 percent on the day.
Abiomed posted profits of $601,000, or 2 cents per share, on sales of $29.5 million for the three months ended Sept. 30 – a top-line boost of some 26 percent, compared with losses of $3.2 million, or 9 cents per share, on sales of $23.4 million during the same period last year.
Adjusted to exclude one-time items, EPS was 9 cents per share, the exact inverse of expectations on The Street, where analysts were looking for adjusted losses of 9 cents per share.
Abiomed further pleased The Street by reinforcing its guidance for the rest of fiscal 2012, saying it expects to boost revenues by 20 percent to 24 percent, to between $120 million and $125 million.
Sales of Abiomed’s flagship Impella device, a tiny pump inserted via catheter to provide cardiac assist to patients with heart failure, were up 40 percent to $24.8 million during the quarter. U.S. Impella sales rose 41 percent to $23.1 million.
Insulet surges despite missing Q3 guidance, lowered forecast
Insulet Corp. (NSDQ:PODD) also surged on Friday, but for less decipherable reasons – the insulin management company missed Wall Street’s third-quarter expectations and lowered its full-year sales guidance.
Yet PODD shares jumped nearly 15 percent Nov. 4, despite losses of $13.6 million, or 29 cents per share, on sales of $44.6 million for the three months ended Sept. 30 – a 12.1 percent increase over net losses for the same period last year.
Perhaps investors liked the 75.2 percent sales growth over the same period in 2010, or the increased demand cited by president & CEO Duane DeSisto for its flagship OmniPod device, or additional traction north of the border now that Health Canada has approved the OmniPod, or a hoped-for FDA nod for the next-gen OmniPod.
Whatever the reason, PODD shares closed up 14.5 percent Friday at $17.00 and were above that mark as of about 3 p.m. today, trading at $17.12.
Analysts’ ups and downs
- Insulet Corp. (NSDQ:PODD): JPMorgan Chase & Co. lowers price target to $24; Jefferies lowers target to $21; Barrington Research reiterates "outperform" rating.
- Abbott (NYSE:ABT): JPMorgan Chase & Co. reiterates "neutral" rating, sets $55 target.
- Baxter International (NYSE:BAX): Morgan Keegan reiterates "outperform" rating, sets $67 target.
- Smith & Nephew (NYSE:SNN): Credit Suisse downgrades to "neutral" from "outperform."