Earnings Preview: Wyeth

Wyeth (WYE) is expected to report Q3 earnings before market open Wednesday, October 22, with a conference call scheduled for 8:00 am ET.

Guidance

Analysts are looking for a profit of 90c on revenue of $5.86B. The consensus range is 88c to 95c for EPS, and revenue of $5.70B to $6.07B, according to First Call. For Q2, Wyeth reported EPS 91c vs. consensus of 87c and revenue $5.9B vs. consensus of $5.7B. Possible positive drivers for this quarter could be sales growth in Effexor, Enbrel and Prevnar. Possible negative drivers for this quarter could be the growing competition of generics. Teva (TEVA) launched a generic version of Wyeth's heartburn drug, Protonix earlier this year.

Analyst Views

In an October 2 note Bernstein said that Wyeth is attractive at current levels. Bernstein believes that in the next 12 to 18 months, Wyeth could release data on new drugs that could represent significant new opportunities for the company. The most significant of these drugs, according to the firm, is Prevnar for pneumonia prevention and a meningitis B vaccine.

On September 24, Citigroup lowered its target on Wyeth to $36 from $39. Citigroup sees downside risk to their Effexor estimates as the firm expects generic erosion based on aggressive pricing by Osmotica. The firm reiterated its Sell rating.