By Mackenzie Tatananni
West Pharmaceutical Services stock sank Thursday after the company issued a full-year outlook that missed analysts' expectations.
Shares plunged 31% to $222.46, putting them on pace for their worst same-day percentage decrease in the company's history. The sharp downturn made West Pharmaceutical the worst-performing stock in the S&P 500 on Thursday.
The maker of delivery systems for injectable medicines said it expects 2025 net sales between $2.875 billion and $2.905 billion, missing analysts' calls for $3.039 billion at the midpoint.
The guidance accounts for an estimated headwind of $75 million based on current foreign exchange rates, management said during the company's earnings call.
West Pharmaceutical also forecast 2025 adjusted earnings in the range of $6 to $6.20 a share. Analysts polled by FactSet expected $7.45.
In addition to currency headwinds, management pointed to incremental investments in research and development, operating expenses, and a so-called "glucose monitoring transition," all of which impacted estimates.
West Pharmaceutical said it had decided to end its partnership with two large continuous glucose monitoring clients "as our financial thresholds cannot be achieved." One customer already has started to exit, while the other intends to do so in mid-2026, the company said.
The company's earnings for the fourth quarter of 2024, meanwhile, were better than expected. West Pharmaceutical posted adjusted earnings in the period of $1.82 a share, marking a 0.5% decrease from the previous year but still topping calls for $1.72, according to FactSet.
Fourth-quarter 2024 net sales of $749 million increased 2.3% and handily surpassed expectations for $740 million. The company also noted that organic net sales grew 3.3% in the quarter.
Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com
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February 13, 2025 11:29 ET (16:29 GMT)
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