AmerisourceBergen Corporation ABC posted earnings (excluding one-time items) of $1.68 per share in the second quarter of fiscal 2016 (ended Mar 31, 2016), beating the Zacks Consensus Estimate of $1.59 and up from the year-ago tally of $1.45. Revenues jumped 9.3% to $35.7 billion in the reported quarter and came slightly ahead of the Zacks Consensus Estimate. The Quarter in Detail In the reported quarter, revenues from the Pharmaceutical Distribution segment (including AmerisourceBergen Drug Corporation [ABDC]) and AmerisourceBergen Specialty Group [ABSG]) climbed 8% to $34.2 billion. Within the segment, revenues from the ABDC business increased 6% primarily driven by solid organic sales growth from chain retail and health systems customers. The ABSG unit performed well during the quarter, with revenues surging 18% year over year driven by strong performance of the oncology business (including an increase in sales to community oncologists), along with sales growth in blood products, vaccine and physician office distribution businesses. Revenues from the Other segment (AmerisourceBergen Consulting Services, World Courier and MWI Veterinary Supply) were $1.6 billion, up 62% backed by the inclusion of revenues from the Feb 2015 acquisition of MWI Veterinary Supply. In addition, the company announced that its board of directors has authorized a new regular share repurchase program, which when combined with the company’s existing program, will allow the company to purchase shares worth up to $750 million. AmerisourceBergen has spent $100 million to repurchase shares of its common stock to date. Fiscal 2016 Guidance Yet again, AmerisourceBergen narrowed its guidance as it expects gross profit in the second half of fiscal year to be negatively impacted by headwinds such as an increase in the rate of generic deflation, and a lower contribution from the new generic launches. Moreover, the company’s efforts to increase sales of PRxO generics and revenues from independent retail segment are ramping slower than projected. The company now expects earnings per share in the range of in the range of $5.44 to $5.54, down from the previous estimate of $5.73–$5.83. The pre-earnings Zacks Consensus Estimate of $5.78 is way above the high end of the company’s updated guidance. Our Take Although this Zacks Rank #4 (Sell) company beat estimates in the second-quarter of fiscal 2016, the series of cuts in the annual guidance is a concern and reflects the challenging conditions ahead of the company. These trends are expected to continue in fiscal 2017 as well. Apart from the abovementioned headwinds, recent contract renewals, along with expenses related to some key investments in the company’s information technology systems and infrastructure are expected to dampen growth rates in fiscal 2017. On a positive note, the company announced that it has extended the term of its strategic agreement with its largest pharmacy retail customer, Walgreens Boots Alliance WBA for an additional three years. The company also disclosed that its large pharmacy benefit manager customer has extended their contract for an additional year. A couple of better-ranked stocks in the healthcare sector include Shire SHPG and Nektar Therapeutics NKTR. Both stocks carry a Zacks Rank #2 (Buy). Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >> (We are reissuing this article to correct a mistake. The original article, issued earlier today, May 5, 2016, should no longer be relied upon)Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report NEKTAR THERAP (NKTR): Free Stock Analysis Report WALGREENS BAI (WBA): Free Stock Analysis Report AMERISOURCEBRGN (ABC): Free Stock Analysis Report SHIRE PLC-ADR (SHPG): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research