| Stock (Symbol) | Stock Price | |
Express Scripts (ESRX) |
$62 |
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| Data is as of | Expected to Report | Sector |
May 20, 2013 |
Aug 5 – Aug 12 |
Healthcare |
| Sharek’s Take | ||
 I had trouble figuring ESRX’s Fair Value P/E this quarter. I originally put the stock’s worth at 16 times earnings, but after much thought took the P/E to 18. 18 times earnings is optimistic, but I want the upside to be solid in this stock, and for us to continue to own ESRX. Why? It’s been an excellent stock over the long-term (check the ten-year chart below). ESRX is a 16% grower and I think the safety and consistency the stock delivers gives it a net worth of more than 16 times earnings. Will ESRX get to a P/E of 18 this year? Probably not. That’s fine, you’re portfolio will be holding a stock with a decade long chart that points up. |
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| One-Year Chart | ||
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| Earnings Table | ||
 Sales increased 115% last quarter as sales with Medco got compared to sales before Medco. Profits jumped 36%.ESRX beat by a penny and from here-on-out should come pretty close to hitting estimates. Annual Profit Estimates moved slightly higher. There is a big customer deal that’s hitting the books and is front loaded to this quarter’s estimates. So ESRX will have higher than normal profits this quarter and lower than normal profits the following two quarters. It’s fine. |
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| Fair Value | ||
 Eventually ESRX will get to 18 times earnings, in the meantime its a stock you can trust. |
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| Ten-Year Chart | ||
 Don’t you think this stock deserves a P/E of 18? I do. Although profit growth this decade won’t be as good as profit growth last decade, the company will certainly keep growing in the teens through the combination of stock buybacks, slight increases in sales, and the company selling more profitable generics. |
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| Power Ranking | Bottom Line | |
Growth Portfolio
4 of 17 |
ESRX is not as discounted as it was six months ago. The stock is higher and now has momentum. Profits will be erratic the next few quarters, but I feel this is a stock that will reward patient investors. ESRX ranks 4th in the 17 stock Growth Portfolio Power Rankings and 4th in the 10 stock Aggressive Growth Portfolio Power Rankings. |
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Aggressive Growth Portfolio
4 of 10 |
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The last four quarters of earnings are skewed because ESRX merged with Medco and the combined entity produced these four quarters of solid results. In the future we should expect high-teens profit growth on average. I love the P/E of only 