Healthcare Stocks' Q2 Earnings On Aug 8: BKD, BIOS, DVA

Medical is one of the eight sectors in the S&P 500 cohort that is expected to record growth in earnings in the second quarter. The sector is likely to post earnings growth of 4.4% on revenue improvement of 7.7%.  

We note that 414 S&P companies have already reported their quarterly numbers, with 70.3% of them beating EPS estimates and 51.9% surpassing the top-line estimate.

As per the latest Zacks Earnings Trend report, overall second-quarter earnings for the S&P 500 companies are expected to be down 3.1% year over year on revenue decline of 0.4%.

Healthcare is an important component of the Medical sector and is expected follow the earnings growth trajectory in the quarter.

Here, we take a look at three healthcare stocks scheduled to report their second-quarter figures on Aug 8:

Brookdale Senior Living Inc BKD is the leading operator of senior living communities throughout the United States. We believe impressive revenue contribution from the senior housing segment, strong focus on core business and exclusive ‘senior-living’ solutions are the key drivers.

BROOKDALE SENR Price and EPS Surprise

BROOKDALE SENR Price and EPS Surprise | BROOKDALE SENR Quote

Notably, the recent announcement of Brookdale to rationalize its portfolio by divesting 44 communities is a positive. Meanwhile, the company has disposed a total of 30 communities with 2,594 units, either through sales or lease terminations. We expect these initiatives to reduce operational disruptions and fortify Brookdale’s core business.

However, our proven model does not conclusively show that the company is likely to beat earnings, given the combination of a Zacks Rank #4 (Sell) and Earnings ESP of 0.00%. We note the Most Accurate estimate and Zacks Consensus Estimate for the company is pegged at 59 cents.

As per our proven model, a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to beat estimates. Simultaneously, we caution against stocks with a Zacks Rank #4 or 5 (Sell-rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

BioScrip Inc BIOS is a major national provider of infusion and home care management solutions. The Infusion platform, addition of new hospital-transitional care contracts and exceptional clinical management capabilities are likely to drive growth.

Moreover, the recent announcement to acquire all the assets of Home Solutions is a major positive, which should help BioScrip to take over a leading position in the Home Infusion market.

BIOSCRIP INC Price and EPS Surprise

BIOSCRIP INC Price and EPS Surprise | BIOSCRIP INC Quote

Nevertheless, our proven model does not conclusively show that the company is likely to beat estimates, given the combination of a Zacks Rank #2 and Earnings ESP of 0.00%.

This is because both the Most Accurate estimate and the Zacks Consensus Estimate for the company is pegged at a loss of 9 cents.

Headquartered in Denver, CO, DaVita HealthCare Partners Inc DVA is a leading provider of dialysis services in the U.S. to patients suffering from chronic kidney failure, also known as end stage renal disease (ESRD).

An improved performance by the Kidney Care segment, strategic acquisitions, collaborations with local hospitals, strong financial position and a compelling inorganic growth story are the key accelerators for growth.

DAVITA HEALTHCR Price and EPS Surprise

DAVITA HEALTHCR Price and EPS Surprise | DAVITA HEALTHCR Quote

However, our proven model does not conclusively show that the company is likely to beat earnings, given the combination of a Zacks Rank #4 and Earnings ESP of +2.04%. We note that the Most Accurate estimate for DaVita stands at $1.00, while the Zacks Consensus Estimate is pegged at 98 cents.

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BROOKDALE SENR (BKD): Free Stock Analysis Report
 
DAVITA HEALTHCR (DVA): Free Stock Analysis Report
 
BIOSCRIP INC (BIOS): Free Stock Analysis Report
 
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