Becton Dickinson Ups Profit Forecast on Strong Device Sales

Becton Dickinson, a leading name in medical devices, has revised its profit forecast for 2026, raising the lower end after a strong third quarter performance driven by its drug delivery devices and surgical equipment. The company now anticipates an adjusted profit per share between $12.62 and $12.72 for the full year, compared to an earlier forecast ranging from $12.52 to $12.72.

The announcement came after Becton Dickinson reported adjusted earnings of $3.23 per share for the quarter ending June 30, surpassing the $3.14 average estimate by analysts. The company also posted a quarterly revenue of $4.98 billion, exceeding projections of $4.89 billion.

Market Reaction and Future Projections

Following the earnings report, shares of Becton Dickinson rose by 4% in early trading. Analysts, including those from Citi, noted the positive results as a sign of recovery after several challenging quarters.

Looking ahead to fiscal 2027, CEO Tom Polen expressed a cautious outlook, projecting revenue growth to start from a low-single-digit baseline. This conservative stance is attributed to the volatility in oil prices, which directly impacts the cost of resins and molded plastics, crucial materials for manufacturing syringes and catheters. The company estimates that rising oil prices could increase costs by $60 million to $70 million.

Strategies to Mitigate Cost Increases

Chief Financial Officer Vitor Rogue emphasized that Becton Dickinson is proactively addressing these challenges. "Oil is a factor that we are monitoring very closely," Rogue said, adding that they have already initiated pricing actions to counterbalance the potential cost increase.

Materials like resins and molded plastics constitute approximately 5% of Becton Dickinson's cost of goods sold. The company is confident that strategic price adjustments will help offset the financial impact of higher oil prices.

The updated profit forecast aligns with analysts' expectations, as the average estimate for annual profit stands at $12.61 per share, according to data from LSEG.