The earnings season crunch is upon us once again, and among those companies reporting next week are Altria Group Inc. (NYSE: MO) and Pfizer Inc. (NYSE: PFE).
In its second quarter report in July, Atria reported earnings per share of $1.15, beating Wall Street's expectations by a couple of pennies. However, Altria has had five-year earnings per share growth of only 1.9 percent, well below the tobacco industry average and the S&P 500. For the third quarter, analysts surveyed by Thomson Financial expect Intel to report EPS of $1.14, about the same as last quarter, and less than the $1.39 actual EPS from the same period last year.
Yet, the handful of analysts surveyed by Thomson Financial recommend buying Altria: two rate it a strong buy, six a buy, and four a hold. Altria's share price is up from a 52-week low of $63.13 in July, but well off of its 52-week high of $90.50 in January [before the Kraft Foods spin off]. It closed Friday at $70.06.
For more on Supreme Court decisions, cigarette taxes, and other news that might affect Altria's quarterly report, check out BloggingStocks' Altria coverage.
Pfizer missed analysts' EPS expectations by seven cents when it reported second quarter results back in July. Before that, Pfizer had beat Wall Street expectations in the previous eight quarters. Analysts surveyed by Thomson Financial expect earnings per share of 52 cents for the third quarter, up from 42 cents actual in the second quarter, and a couple of pennies lower than in the same quarter a year ago. The EPS growth of 4.8 percent over the past year is only about half of the pharmaceutical industry average, and less than the S&P 500.
The consensus of analysts surveyed by Thomson Financial has shifted from buy to hold PFE in the past month, 14 of them now saying hold, but only 6 buy or strong buy. Pfizer's share price has struggled to rise from a 52-week low of $23.13 in August, and closed Friday at $25.26.
For more on Pfizer's new R&D chief and news about rivals that could affect Pfizer's quarterly report, see BloggingStocks' Pfizer coverage.
Altria reports earnings on Wednesday, Pfizer on Thursday.
[UPDATED: mention of Altria's Kraft Foods spin off added]
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Reader Comments (Page 1 of 1)
10-14-2007 @ 9:05PM
Bob Franklin said...
Isn't using the 52 week high of $90.50 for Altria a little misleading since it was prior to the Kraft sale which drop the price with the appropriation of Kraft stock??
10-14-2007 @ 8:55PM
John A Wilson said...
Price to earnings relative to stock price. Prior to 2000 it didn't seem that important, I guess if you didn't learn that lesson, tell yourself they don't matter again if you have any money left. I thot a short on Amazon at 245 a share was prudent, hey what did I know.
10-15-2007 @ 1:57AM
Bill said...
Yes, using the 52 week high of $90.50 for Altria is misleading. Based on Friday, Oct. 12, closing prices, Altria's pre-Kraft spin-off value would be approximately $93.42 [MO 70.06 + KFT 33.85 (.69)].
10-15-2007 @ 12:13PM
Mr. Monkey said...
What was the exact ratio of the spin off of Kraft?
10-15-2007 @ 2:50PM
Bob said...
the reference to the pre kraft spinoff price and earnings is terrible. if i authored this blog i would remove this article immediately to save myself the embarassment. well written but trey you missed the boat on this one.
10-15-2007 @ 7:47PM
Bill said...
The exact ratio for the spin-off of Kraft was "0.692024 of a share of Kraft for every share of Altria common stock outstanding" (Source: http://www.altria.com/investors/02_20_00_spinoffinvinfo.asp).