Earnings Preview: IMS Health

IMS Health (RX) is scheduled to report Q2 earnings Monday, July 21 before market open, with a conference call scheduled for 8 am ET.

Guidance

Analysts are expecting a profit of 40c on revenue of $590.27M. The consensus range for EPS is 39c to 42c, with a revenue range of $574.70M to $599.80M, according to First Call.  On May 28 IMS Health gave FY08 EPS guidance of $170 to $1.76 vs. consensus of $1.73.

Analyst Views

Possible positive drivers for this quarter's earnings include: cost savings from previously implemented restructuring, improved operating efficiency, positive foreign exchange translations, and new product offerings. Negative factors include the below pace growth of the the global pharmaceutical market.

This Spring, Baird put out a research note voicing concern about the ongoing challenges and uncertainties with the healthcare market worldwide and that expectations for IMS Health are heavily dependent on restructuring benefits. While valuation is far from being stretched, Baird continues to be cautious about fundamentals as well. The firm maintained a Neutral rating with a target price of $26.