Becton, Dickinson and Co. Poised for Growth

Becton, Dickinson and Company (BDX) offers a return on equity of 23%, exceeding the industry average of 17%. The company’s dividend yield of 1.7% is also ahead of the industry average as most of BDX’s peers pay no income. BDX is scheduled to release fiscal fourth quarter results on Nov 05.

Company Description

Becton, Dickinson and Company is a medical technology company that develops, manufactures and sells medical devices, instrument systems and reagents. BD is focused on improving drug delivery, enhancing the quality and speed of diagnosing infectious diseases and cancers, and advancing research, discovery and production of new drugs and vaccines.

Founded in 1897 and headquartered in Franklin Lakes, New Jersey, BD employs approximately 28,000 people in approximately 50 countries throughout the world. The company serves healthcare institutions, life science researchers, clinical laboratories, the pharmaceutical industry and the general public.

Recent Events

On September 23, 2008, Becton, Dickinson and Company (BD) announced that it has signed a development and supply agreement with Luminex Corporation, a worldwide leader in multiplexed solutions, through its BD Diagnostics-TriPath platform. Under the terms of the agreement, BD Diagnostics-TriPath will develop, market and sell new biomarker-based diagnostic tests for certain cancers using Luminex s multiplexing xMAP Technology platform.

Luminex’s xMAP Technology is a proprietary multiplexing platform that allows scientists to conduct multiple, simultaneous tests on one patient sample. Flexible and designed for ease-of-use, it offers researchers and clinicians rapid and accurate results and allows them to save significant time and resources. xMAP Technology can be found in more than 5,400 clinics and laboratories worldwide and is used in 56 products that have been cleared by the U.S. Food and Drug Administration.

Fundamentals Signal Growth

On July 24, 2008, Becton, Dickinson and Company reported its financial results for the fiscal third quarter. Total revenues increased 14.5% to $1.868 billion, up 7.6% on a constant-currency basis. There was an overall 6.9% favorable impact from foreign currency that affected all segments. BD Medical’s revenues grew 15.2% (up 7.8% constant-currency) to $1.016 billion. BD Diagnostics revenues grew 12.6% (up 6.9% constant-currency) to $553.4 million. BD Bioscience’s revenues grew 15.6% (up 8.3% constant-currency) to $297.8 million.

Earnings per share of $1.18 came in 7% ahead of the consensus estimate and outperformed the year-prior result. The company has, on average, exceeded analyst estimates by 4.25% over the past five consecutive quarters.

”We are pleased that all segments and regions, particularly Europe and Asia, contributed to solid revenue growth," said Edward J. Ludwig, Chairman, President and Chief Executive Officer. He added that operating results were also favorable.

The company offers a return on equity [ROE] of 23%, exceeding the industry average of 17%.

Becton, Dickinson and Company is scheduled to release fiscal fourth quarter results on Nov 05.

Competitive Income

On July 22, 2008, Becton, Dickinson and Company declared a quarterly dividend of 28.5 cents per share. The dividend was paid out on September 30. The company’s dividend yield of 1.7% is ahead of the industry average as most of BD’s peers pay no income.

Comments

[Dividends A...:]

BDX is rarely "cheap" but an excellent company if you want to gain exposure to a broad based healthcare company. I would still prefer Baxter (BAX) to BDX in the same space, but BDX isn't a horrible company to own in this environment.

2008 Oct 30 09:17 PM