Healthcare Stocks on the Move

Joel Anderson |

Strong earnings reports are helping to drive up healthcare stocks across the sector as major companies continue to outpace analyst expectations.  With strong results released Wednesday and Thursday and a slate of releases scheduled for next week, the healthcare industry showed solid gains on the positive news.

DENTSPLY Shows Major Gains

DENTSPLY International, Inc. (XRAY) gaped up 14 percent to start Thursday before settling into a more modest 10.72 percent gain by the end of the day after their Q3 earnings sheet released after market close on Wednesday proved to be very positive.  DENTSPLY, a dental supplies maker, reported a 14.4 percent increase in net sales year-over-year to $619.8 million.  Net income was $60.6 million or $0.42 per share.  While this represents a 4.5 percent decrease in EPS year over year, it's far better than expected given the disruption to orthodontic supply in Japan.  Based on these results, Chairman and CEO Bret Wise announced that the company was improving its 2011 guidance for earning on an adjusted basis from $1.96 to $2.04 per share to $2.01 to $2.07 per share.  Stated Wise, "We are pleased to report another quarter of strong performance despite the orthodontic supply disruption in Japan. We are also excited to have closed the Astra Tech transaction during the quarter allowing us to begin the integration process earlier than we originally anticipated. We are pleased with the early assessment coming out of our integration efforts."  DENTSPLY acquired Astra Tech, a Swedish maker of dental implant products, on August 31 for $1.8 billion.

Alere Stock Jumps Nearly 1/4 in Two Days

Health management solutions company Alere, Inc. (ALR) continued climbing on Thursday after their Q3 earnings reports, released Wednesday morning, also showed solid growth.  The stock was up 7.61 percent on Thursday after posting a 14.49 percent jump on Wednesday, giving it a total climb of over 23 percent for the two days combined.  Alere, formerly known as Inverness Medical Innovations, saw their Q3 profitability jump in part due to a joint venture with Procter & Gamble Co. (PG) they began in 2007.  Alere posted a year-over-year revenue increase of 8.7 percent to $585.8 million while adjusted profits were up 13.5 percent to $0.67 per share.  This smashed expectations in a Reuters poll of analyst  that produced an anticipated EPS figure of only $0.59 and helped spark the stock's major rebound.  Helping improve their balance sheet was the more than doubled sales of North American influenza and a 19 percent jump in revenue in Alere's professional diagnostics segment.  Said Chairman and CEO Ron Zwanziger, "Viewing global revenue trends as a whole and factoring the projected income of new product sales over the next several years, we continue to expect strong and increasing organic topline growth for our Professional Diagnostics business throughout 2012 and beyond."

Healthcare Stocks Improve Across the Board

Other healthcare stocks also posted strong gains on Thursday as strong earnings and good news out of Europe contributed to a robust day of trading.  Included in these were the Geron Corporation (GERN) up 13.16 percent, Dendreon Corp. (DNDN) with a 10.17 percent rise, and Endo Pharmaceuticals Holdings, Inc. (ENDP) which posted a 7.57 percent gain.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to:


Symbol Name Price Change % Volume
ALR Alere Inc. 44.10 0.93 2.15 717,846
ENDP Endo International plc 20.53 0.64 3.22 3,647,880
FRM Furmanite n/a n/a n/a 0
GERN Geron Corporation 2.09 0.01 0.48 1,214,307
PG Procter & Gamble Company (The) 84.93 -0.61 -0.71 10,175,116
XRAY DENTSPLY SIRONA Inc. 59.05 -0.36 -0.61 1,264,613


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