Valeant Pharmaceuticals (VRX) Stock: Falling Hard On Earnings And Guidance

Valeant Pharmaceuticals Intl Inc VRX Stock NewsValeant Pharmaceuticals Intl Inc (NYSE: VRX) is having an overwhelmingly rough start to the trading session this morning, and for good reason. The company reported its financial results for the fourth quarter, missing expectations. To make matters worse, the company released guidance that simply didn’t meet up with what investors wanted to see. Today, we’ll talk about what we saw from the report, what we’re seeing from the stock, and what we’ll be watching for with regard to VRX ahead.

VRX Misses The Mark

As mentioned above, Valeant Pharmaceuticals isn’t having the best of days in the market today. Unfortunately, the company reported its earnings for the fourth quarter, missing the mark and dampening expectations with regard to what we can expect to see ahead. Here’s what we saw from the report:

  • Earnings Per Share – In terms of earnings per share, VRX did not provide an adjusted earnings per share figure. However, earnings for the quarter came in at $5.13, bringing non-adjusted earnings per share to $1.45 in the fourth quarter.
  • Revenue – Unfortunately, when it comes to revenue the company missed the mark. During the quarter, revenue declined from $2.40 billion to $2.16 billion. Analysts were expecting that the company would generate revenue in the amount of $2.18 billion.
  • Guidance – While missing revenue isn’t a positive, things got worse when guidance was released. During the year 2018, the company expects that revenue will come in between $8.1 billion and $8.3 billion. Unfortunately, that falls short of analyst expectations at $8.38 billion.

In a statement, Joseph C. Papa, Chairman and CEO at VRX, had the following to offer:

2017 was a year of strong progress for Valeant as we delivered organic growth across nearly 75 percent of the Company while significantly reducing our debt and investing in our Bausch + Lomb, Salix and Ortho Dermatologics businesses. 

Since the end of the first quarter of 2016, we’ve reduced our total debt by more than 20 percent, and we will continue to address our debt, as well as reduce expenses. Additionally, we’re committed to growth through strategic investment in our core businesses, key products and late-stage pipeline. Altogether, these will get us to the final phase of our strategic plan – the transformation of Valeant.

What We’re Seeing From The Stock 

Unfortunately, Valeant Pharmaceuticals isn’t having the best of days in the market today. After all, news often moves the market, and the earnings news surrounding the company just wasn’t good. This, combined with dampened expectations for the year ahead, would cause declines in just about any stock. Of course, our partners at Trade Ideas were the first to alert us to the losses. Currently (8:52), VRX is trading at $17.42 per share after a loss of $1.08 per share (5.84%) thus far today.

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What We’ll Be Watching For Ahead

Moving forward, the CNA Finance team will continue to keep a close eye on VRX. In particular, we’re interested in following the company’s continued work to pay down debts and reduce costs. We’ll also be watching their revenue and hoping that the company finds some way to expand their revenue beyond the expectations set forth today. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks.

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