Express Scripts Holding, the largest US processor of drug prescriptions, gave a profit forecast for the year that exceeded analysts’ lowered estimates.
Profit excluding certain items will be $4.20 to $4.30 a share this year, St. Louis-based Express Scripts said in a statement. Analysts expected $4.20, the average of 21 estimates compiled by Bloomberg. The estimates were reduced from an average of $4.50 in November when the company suggested the predictions were too high.
Express Scripts, which last year purchased Medco Health Solutions for $29 billion, manages drug benefits for insurers and for employers, and sells drugs through mail-order pharmacies. It said in November that analysts’ views for profit growth were overly aggressive, citing a business climate that may lead to a loss of members, less drug utilization and price pressure. Some analysts remain optimistic.
“The company, with its acquisition of Medco, has the opportunity to be the dominant industry leader,” Anthony Vendetti, an analyst at Maxim Group in New York. “We expect the company to achieve net new business wins in 2013 and build upon the positive momentum created in its Medicaid business.”
The integration of Medco is “on schedule,” he said, and all former Medco patients should be transferred to Express Scripts by the end of this year.
Express Scripts yesterday reported that fourth-quarter net income from continuing operations rose to $516 million, or 62 cents a share, from $290 million, or 59 cents, a year earlier.