By Jonathan D. Rockoff
Pfizer Inc. is scheduled to announce its third-quarter earnings
Tuesday morning. Here's what you need to know:
EARNINGS FORECAST: Net income of 55 cents a share is the
consensus of analysts surveyed by Thomson Reuters, compared with 58
cents reported during the same period a year earlier. The company
hasn't provided guidance for the third quarter, but said in July it
expects per-share earnings of $1.47 to $1.62 for the year.
REVENUE FORECAST: Revenue of $12.2 billion is forecast, compared
with $12.6 billion reported during the period a year earlier.
WHAT TO WATCH:
--PFIZER DEAL INTEREST: Pfizer talked with at least two
companies, AstraZeneca PLC and Actavis PLC, this year about doing a
large deal that would lower Pfizer's tax rate. Neither effort
succeeded, and the U.S. Treasury Department recently issued rules
designed to deter such tax-lowering deals. Has the government's
actions driven Pfizer away from pursuing such a deal? Or might
Pfizer be interested in a purely strategic-minded big deal?
--COMPANY THINKING ON SPLIT: After shedding its animal-health
and nutrition businesses in recent years, Pfizer said it would
entertain splitting up the company. Starting this year, Pfizer
began breaking out the financials for its three units, a
requirement for any split. "What we do eventually will really
depend upon how those businesses perform--how our shareholders
value those businesses," Pfizer Chief Executive Ian Read said
during a second-quarter earnings call in July. How did those
businesses perform in the third quarter?
--NEARER-TERM GROWTH DRIVERS. Pfizer's Prevnar pneumonia vaccine
was recently recommended for a new use--in adults over the age of
65. Analysts say that could add another $1 billion or more in
yearly sales. Will it? The quarter's results might give an early
peek. Investors will also listen for any updates on the progress of
Pfizer's palbociclib breast-cancer drug, which the Food and Drug
Administration is reviewing for approval. Analysts think the drug
could have more than $3 billion in yearly sales.
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