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Tickers in this Article: BIIB
On Thursday, October 25, 2012, Biogen Idec (Nasdaq:BIIB) will report its third quarter earnings.

A business' earnings are the main determinant of its share price because earnings and the circumstances relating to them can indicate whether the business will be profitable and successful in the long run. SEE: Surprising Earnings Results

What to Expect: Analysts are expecting Biogen Idec to report earnings of $1.61 per share, up 2.5% from a year ago, when the company reported earnings of $1.57 per share.

In the last 90 days, this has risen from $1.59. For the fiscal year, analysts are projecting earnings of $6.46 per share.

Biogen Idec is expected to report revenue of $1.38 billion for the quarter, beating last year's figure of $1.31 billion by 5.3%. Biogen Idec is expected to report revenue of $5.49 billion for the fiscal year.

Company Performance: These last four quarters have marked revenue growth. It rose 17.6% in the second quarter, 7.4% in the first quarter, 8.8% in the fourth quarter of the last fiscal year and 11.4% in the third quarter of the last fiscal year.

P/E ratio for BIIB is 26.4. One of the most important estimates of stock market valuation is the price/earnings ratio (P/E ratio). A high or low P/E ratio is not good or bad in and of itself, but a company trading with a high P/E ratio must continue to post strong financial performance or its stock price is likely to fall. SEE: The P/E Ratio: A Good Market-Timing Indicator

Over the past quarter, the stock price has risen to $145.65 from $139.48 on July 24, 2012. Biogen Idec's best recent streak was when its price gained $8.28 per share between August 10, 2012 and October 17, 2012.

The Competition: Biogen Idec is a global biotechnology company that meets the rising needs of therapeutic care providers and recipients. Twelve of 20 analysts give Biogen Idec a buy rating. Buy ratings have increased slightly over the last three months.

The company's closest competitor in the biotechnology and drugs industry is Merck (MRK). Analysts are more optimistic about Biogen Idec than about Merck. Only 10 out of 17 analysts rate the latter a buy.

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