Stock Buy: Perrigo Co.

Perrigo Co. (PRGO: 45.4999 -0.3101 -0.68%) recently delivered record results, which prompted upward revisions in the Zacks Consensus Estimate. The current earnings estimate of $2.59 per share is up from last week’s $2.43 for the fiscal year ending June 2010. For the following year, the forecast of $2.87 climbed from $2.64 over the past week.

Company Description

Perrigo Co. develops, manufactures, and distributes over-the-counter (OTC) and prescription (Rx) pharmaceuticals, nutritional products, active pharmaceutical ingredients (API), and medical diagnostic products worldwide.

Record Results

Perrigo’s second-quarter earnings of 70 cents per share, eclipsed the Zacks Consensus Estimate by 6%. Revenue of $583 million was up 9% year-over-year.

Management said the company delivered all-time record quarterly revenue and earnings as well as record second quarter cash flow, adding that the Consumer Healthcare, Rx and API segments all contributed to the strong performance.

Upward Revisions

The company hiked its fiscal 2010 adjusted earnings guidance to a range of $2.55-$2.65 per share from a range of $2.35-$2.45 per share.

Analysts polled by Zacks are pegging earnings at $2.59 per share for the year ending June 2010, an increase from last week’s $2.43. For the following year, the Zacks Consensus Estimate of $2.87 per share was upped from last week’s $2.64.

Rewarding Shareholders

Perrigo also recently declared a quarterly dividend of $0.0625 per share, noting that it is payable on Mar 16 to shareholders of record on Feb 26. The company pays an industry-leading dividend yield of 0.55%.

Strong Momentum

Shares of PRGO spiked on the record quarter, adding to the more than 50% lead that Perrigo has accumulated over the S&P during the past year.