Sigma-Aldrich Second Quarter Earnings Sneak Peek

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S&P 500 (NYSE:SPY) component Sigma-Aldrich (NASDAQ:SIAL) will unveil its latest earnings on Tuesday, July 24, 2012. Sigma-Aldrich is a life science and high technology company that develops, manufactures, purchases and distributes a range of high quality chemicals, biochemicals and equipment.

Sigma-Aldrich Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for profit of 97 cents per share, a rise of 4.3% from the company’s actual earnings for the year-ago quarter. The average estimate is the same as three months ago. Between one and three months ago, the average estimate moved up. It has dropped from 98 cents during the last month. Analysts are projecting profit to rise by 6.7% versus last year to $3.98.

Past Earnings Performance: Last quarter, the company saw net income of 99 cents per share versus a mean estimate of profit of 99 cents per share. This comes after two consecutive quarters of exceeding expectations.

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Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 2.29 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands. The company regressed in this liquidity measure from 3.33 in the fourth quarter of the last fiscal year to the last quarter driven in part by an increase in liabilities. Current liabilities increased 42.8% to $768 million while assets decreased 1.9% to $1.76 billion.

Wall St. Revenue Expectations: Analysts are projecting a rise of 6% in revenue from the year-earlier quarter to $675.4 million.

Stock Price Performance: Between May 21, 2012 and July 18, 2012, the stock price had risen $2.30 (3.3%), from $70.21 to $72.51. The stock price saw one of its best stretches over the last year between January 13, 2012 and January 25, 2012, when shares rose for eight straight days, increasing 9.4% (+$6.04) over that span. It saw one of its worst periods between July 25, 2011 and August 2, 2011 when shares fell for seven straight days, dropping 13.3% (-$9.80) over that span.

Key Stats:

After last quarter’s profit drop broke a string of income increases, this earnings announcement is definitely a chance for a rebound. Net income rose 16.5% in the second quarter of the last fiscal year, 25.8% in the third quarter of the last fiscal year and 14.9% in the fourth quarter of the last fiscal year before declining in the first quarter.

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 15% in the second quarter of the last fiscal year, 11.2% in the third quarter of the last fiscal year and 4.8% in the fourth quarter of the last fiscal year before increasing again in the first quarter.

Analyst Ratings: There are mostly holds on the stock with nine of 15 analysts surveyed giving that rating.

A Look Back: In the first quarter, profit fell 1.7% to $117 million (96 cents a share) from $119 million (97 cents a share) the year earlier, meeting analyst expectations. Revenue rose 5.2% to $665 million from $632 million.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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