Endo International PLC (ENDP - Free Report) is a global specialty healthcare company that develops, manufactures, markets, and distributes branded pharmaceutical and generic products as well as medical devices.

Headquartered in Dublin, Endo offers branded prescription products, including Lidoderm, Opana ER, Percocet, Voltaren Gel, Frova, Supprelin LA, Vantas, Valstar and Fortesta Gel for pain, urology, endocrinology, and oncology.

While the Zacks Rank #5 (Strong Sell) stock reported fourth quarter results that beat estimates, the company has been on a steady decline for a few years now. Is there any chance for a rebound for this drug maker?

Q4 Earnings: A Deep Dive

Last week, Endo reported results for its fiscal 2017 fourth quarter.

Earnings from continuing operations were 77 cents per share, beating the Zacks Consensus but declining significantly from the $1.77 reported in the year-ago quarter.

Revenues came in at $769 million, also topping our consensus estimate but falling 38% year-over-year thanks to the loss of marketing exclusivity in the first half of 2017 for its first-to-file products: the generic version of Zetia and the generic version of Seroquel XR, both of which were launched in Q4 2016.

Looking at Endo’s three main segments, U.S. Branded Pharmaceuticals sales were down 21% to $228 million, while U.S. Generic Pharmaceuticals recorded sales of $499 million in the quarter, down 43%.

Its International Pharmaceuticals division brought in sales of $41 million, down from $70 million in the year-ago quarter due to recent divestitures.

The Outlook Ahead

Management expects revenues between $2.6 billion and $2.8 billion, with earnings in the range of $2.15 and $2.55 per share, both metrics well below the Zacks Consensus Estimate of $3.06 billion and $2.86 per share, respectively.

As a result, analysts have been cutting their estimates for 2018.

For the current quarter, four analysts cut their outlook in the last 30 days, and earnings are expected to decline over 55% for this time period.

11 analysts have revised their estimates downward for the current fiscal year, with earnings estimates projected to fall about 38.5% in that time frame.

Looking at the next fiscal year, eight analysts have slashed their outlook in the last month, but earnings could grow about 4%. The current consensus has dipped from $3.08 to $2.46 per share.

What’s Next for Endo?

Shares of Endo are down about 6.7% so far this year, and have sunk well over 36% in the past one year. In comparison, its broader industry, Medical-Drugs, has managed to gain 1.31% and 1.64%, respectively.

Endo International PLC Price and Consensus

Endo International PLC Price and Consensus | Endo International PLC Quote

The company is currently trading at a forward P/E of 3.08.

Last year was rocky for Endo. The company quickly became a big litigation target for U.S. states in 2017, and is currently being sued by Indiana, Illinois, Kentucky, Florida, Missouri, Oklahoma, and Mississippi for fraudulent marketing regarding their opioid drug Opana ER.

With these lawsuits still open, there’s no clear picture for investors on what may be the outcome, and Endo could face damaging consequences.

Additionally, both its Branded and Generic businesses have faced intense pressure thanks to new competitors and changing market conditions.

For investors wanting a drug maker stock with more near-term potential, they should consider Zoetis Inc. (ZTS - Free Report) , a company that develops and manufactures veterinary vaccines and medicines. It’s a #2 (Buy) on the Zacks Rank right now, and anticipates 25% earnings growth for the current year.