MiMedx Group, Conn's, Mylan, Pfizer and Amgen highlighted as Zacks Bull and Bear of the Day
CHICAGO, Dec. 12, 2014 /PRNewswire/ -- Zacks Equity Research highlights MiMedx Group, Inc. (Nasdaq:MDXG-Free Report) as the Bull of the Day and Conn's (Nasdaq:CONN-Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Mylan Inc. (Nasdaq:MYL-Free Report), Pfizer (NYSE:PFE-Free Report) and Amgen Inc. (Nasdaq:AMGN-Free Report).
Here is a synopsis of all five stocks:
Today's Bull of the Day comes from biomedical/genetics industry that currently ranks in the Top 22% of our Zacks Industry Rank. If you're looking for innovation and trying to find a company with great revenue growth poised to stick around for the long run, this is a stock you need to pay attention to.
MiMedx Group, Inc. (Nasdaq:MDXG-Free Report)is an integrated developer, processor and marketer of patent protected regenerative biomaterial products and bioimplants processed for human amniotic membrane. In English, they are a regenerative medicine company. They have technology that helps the healing process after surgery and trauma. Their PURION processed allografts enhance healing, reduce scar tissue, reduce inflammation and are immunologically privileged. Backed by proven clinical results, PURION has a 5 year shelf life when stored at ambient conditions.
The growth for MiMedx has been consistent over the last several years and the company feels they can sustain this growth for 2015 and beyond. For twelve consecutive quarters, MDXG has met or exceeded quarterly guidance. The company seeks to continue its market expansion in advanced wound care with EpiFix. It looks to continue expansion into more than 40 different acute and chronic would care procedures. Also, DFU/VLU/Pressure Ulcer patient procedure market growth offers a large opportunity as it accounted for less than 5% of the US market in 2014 and looks to become increasingly larger in the coming years.
Also, MiMedx is looking for surgical application expansion of its AmnioFix product. Spinal procedure penetration should increase in 2015 due to Medtronic distribution. Also, an expansion of OEM customer base in orthopedics as well as plastic surgery expansion should help MiMedx revenue growth. MiMedx has recognized a $13 billion opportunity in the US market alone for their products.
When the economy is humming along, extending consumers credit can help keep the wheels oiled up and running. Lending eases up across the economy from mortgages for homes to auto loans to consumer credit. Today's Bear of the Day is a company that had been readily extending consumers credit to buy their products. The problem is, this last quarter they saw a dramatic rise in delinquencies that is hurting their bottom line.
Zacks Rank #5 (Strong Sell) Conn's (Nasdaq:CONN-Free Report) is a specialty retailer with 90 retail locations across 11 states. The company sells furniture and related accessories for your entire house, as well as appliances, consumer electronics and home office equipment. Unlike many of its competitors, the company provides flexible in-house credit options for their customers in addition to third-party financing programs and third-party rent-to-own payment plans.
It's the in-house credit facility that helped to drag the stock down so much following the last earnings report. Shares of the stock dropped over 40% after a downright depressing quarterly report coupled with the exit of its Chief Financial Officer. Analysts were looking for 68 cents per share profit out of Q3 2014. Instead what they got was an 8 cents per share loss.
Not only did this destroy the stock price but also it caused two analysts to dramatically cut their earnings estimates for current quarter and next year. The resulting drop in consensus took the current quarter number down to 80 cents versus previous estimates for 92 cents while next year's number dropped from $3.39 per share down to $3.16 per share.
A big reason for the negative number was the rise in delinquencies and higher anticipated charge-offs over the next year. Delinquencies rose 10% last quarter and the company was forced to increase its provision for bad debts to $72 million versus $22.6 million the previous quarter. That nearly $50 million write down is what sunk the ship for Q3. Another negative in the report was same store sales dropping 1% year over year. Not something you want to see from a growth company.
Additional content:
Mylan Among First to Launch Generic Celebrex
Mylan Inc. (Nasdaq:MYL-Free Report) announced that it has launched the generic version of Pfizer's (NYSE:PFE-Free Report) Celebrex, approved for the relief of the signs and symptoms of osteoarthritis, rheumatoid arthritis, and ankylosing spondylitis, and for the management of acute pain in adults, in the U.S. However, Celebrex may lead to increased risk of serious cardiovascular thrombotic events, myocardial infarction, strokes, gastrointestinal bleeding, ulceration and perforation of the stomach or intestines.
As per IMS Health, Celebrex sales in the U.S. for the 12 months ending Sep 30, 2014, were $2.5 billion.
We note that Mylan's generic unit had 286 Abbreviated New Drug Applications (ANDA) pending FDA approval. The ANDAs represent annual sales of $111.6 billion, according to data released by IMS Health. Mylan believes that 45 of these pending ANDAs are potential first-to-file opportunities. Data released by IMS Health further revealed that the 45 ANDAs represent annual branded sales of $29.5 billion, for the 12 months ending Jun 30, 2014.
Mylan's Generics division reported revenues of $4.6 billion for the first nine months of 2014. We expect additional generic launches in the coming months as well.
Our Take
We are pleased with Mylan being one of the first companies to launch its generic version of the blockbuster drug Celebrex. However, we note that other pharma companies have also launched generic versions of the popular drug.
Mylan carries a Zacks Rank #1 (Strong Buy). Another well-ranked stock in the health care sector is Amgen Inc. (Nasdaq:AMGN-Free Report), which carries the same Zacks Rank as Mylan.
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