Amgen Posts In-Line Q1 Earnings

Biotech company Amgen posted a 15% rise in Q1 profit on sales of anemia drugs, but forecasts that full-year earnings will be at the low end of expectations. Net income rose to $1.11 billion ($0.94/share) from $1 billion ($0.82) a year ago. Excluding items, profit came in at $1.08/share, meeting Street expectations. Total revenue was $3.69 billion in the quarter, a 15% gain from the year-ago quarter but behind analyst expectations of $3.73 billion. The company plans to cut expenses and adjust revenue forecasts because sales of anemia drugs Aranesp and Epogen are likely to drop now that clinical studies have shown them to increase risk of death when taken in high doses. The two drugs accounted for 45% of Amgen's Q1 revenue. The company is projecting full-year profit to be at the low end of the $4.30-4.50 range forecast in January. At that time, Amgen projected $15.4-16 billion in revenue for 2007, an 8-12% increase from a year ago. Analysts have forecast full-year EPS of $4.31 on revenue of $15.4 billion.

Sources: Conference call transcripts: Q1 2007, MarketWatch, Bloomberg, TheStreet.com, 24/7 Wall Street
Commentary: Amgen Shares Gain on Aranesp Results • Amgen: How Promising Lead Product Will Affect the Stock • Amgen: Bad News Priced In, Growth On The Horizon
Stocks/ETFs to watch: Amgen, Inc. (AMGN). Competitors: Roche Holding Ltd. [ADR] (RHHBY), Novartis AG (NVS), Baxter International Inc. (BAX). ETFs: Biotech HOLDRs (BBH), PowerShares Buyback Achievers (PKW), PowerShares Dynamic Large Cap Growth (PWB)

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