Earnings Preview: Amgen

Amgen (AMGN) is expected to report Q3 earnings Wednesday, October 21 after market open, with a conference call scheduled for 5pm ET.

Guidance

Analysts are looking for EPS of $1.27 on revenue of $3.79B. The consensus range is $1.20-$1.34 for EPS, and $3.73B-$3.88B for revenue, according to First Call. In July, the company reported Q2 EPS of $1.12, beating analysts' expectations of $1.02, and revenue of $5.29B, which was slightly lower than consensus estimates of $5.28B. Positive driver's for Amgen's Q3 results could come from international sales and price increases across the drug company's core product portfolio. Mitigating any benefits from price leverage, Amgen is challenged in its anemia franchise with lower revenue expected from Aranesp. The densumab, Proliia project has been delayed as the FDA has requested a "Complete Response Letter" for the biologics license applications for Prolia in the treatment and prevention of postmenopausal osteoporosis.

Analyst Views

On October 19, Jefferies said Amgen's complete response letter in-line with expectations. Jefferies found the delay in denosumab's approval largely anticipated and continues to expect approval in 1Q10. The firm remains positive on Amgen shares with a Buy rating. On October 17, Citigroup said that Amgen Dmab consensus estimates need to come down, since an FDA panel recommended a more restricted label and did not support fracture prevention. The firm believes the drug's potential is not as big as the Street thinks and it maintains a Hold rating on the stock.