Tomahawk, WI 8/02/2013 (Basicsmedia) – Amgen, Inc. (NASDAQ:AMGN) has been in business since 1980, during which time it has managed to grow large enough and employ more than 18k personnel. It is based in Thousand Oaks, California and is a well known company in the production of biotechnology medicines which it sells in the U.S, Europe and Canada. For the better part, whenever a company posts financial results which seem to favor investors, it would not be wrong to think of this as being the precursor to good news in terms of stock price and dividends. AMGN appears to have experienced the reverse. Why is this so?

Did AMGN Declare Profits or Not?

If you take a close look at the financial results which were posted by AMGN, you would discover one thing, that they all indicated the company made profits. More than that, the company succeeded in making profits which surpassed what Wall Street had projected. In other words it outperformed the expectations of all analysts. As a matter of fact, it even surpassed what it was expected to make in terms of revenue by quite some margin. However, this wasn’t enough to protect the shares from dropping by not less than 1.98% after the results were declared.

When declaring the results, AMGN announced that the adjusted EPS had increased to a $1.89, which in essence represented an increase of not less than 3.28%. This was an improvement from last year’s adjusted EPS which had stood at $1.83. Secondly, compared to what was declared last year as revenue, this year’s was an impressive $4.68 billion, representing an increase of more than 4.51%. This is good news and indicates that the company is in good state financially and it is outperforming everyone’s expectations thus presenting a viable option to all investors.

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Image showing how AMGN has been performing in the stock market for the last year. Image is courtesy of http://finance.yahoo.com/q/bc?s=AMGN+Basic+Chart.

Which Factors are Influencing the Gloomy Performance of AMGN Stock?

The major challenge is now finding out why the company is not experiencing similar positive performance in the stock market.  Many analysts appear to be of the same opinion that AGMN will post poor results in the next quarter when declaring its financial results. It is perhaps this reason which has led to the poor performance by this company on the stock market, where its shares continue to experience a drop in value. It seems there are other factors which investors may not be aware of and are being used to paint a gloomy picture of AMGN stock or shares.

Although there has been increase in terms of profits, adjusted EPS and revenue, what analysts have noted is the fact that the degree of increase has continued to drop. An example is where revenue had increased by a massive 10.41% in the previous quarter while in the immediate quarter, it has only increased by 4.61%. Therefore, it can be stated that the good performance was purely based on what analysts and industry experts had projected and were expecting. This is what has given rise to AMGN’s poor performance on the stock market.

My advice to you, would be that you buy or hold on to your AMGN shares. This is the wrong time to be thinking of selling, unless your need for money to do use on other projects is too much and you can’t wait any more.

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