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CVS Health (CVS) Gains But Lags Market: What You Should Know

CVS Health (CVS) closed the most recent trading day at $75.83, moving +0.57% from the previous trading session. This change lagged the S&P 500's 1.76% gain on the day. Meanwhile, the Dow gained 1.17%, and the Nasdaq, a tech-heavy index, added 3.03%.

Prior to today's trading, shares of the drugstore chain and pharmacy benefits manager had lost 14.66% over the past month. This has lagged the Retail-Wholesale sector's loss of 7.61% and the S&P 500's loss of 5.94% in that time.

CVS Health will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $2.12, down 4.5% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $81.41 billion, up 5.97% from the year-ago period.

CVS's full-year Zacks Consensus Estimates are calling for earnings of $8.84 per share and revenue of $333.43 billion. These results would represent year-over-year changes of +1.73% and +3.4%, respectively.


Any recent changes to analyst estimates for CVS Health should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. CVS Health currently has a Zacks Rank of #3 (Hold).

Digging into valuation, CVS Health currently has a Forward P/E ratio of 8.53. Its industry sports an average Forward P/E of 7.45, so we one might conclude that CVS Health is trading at a premium comparatively.

We can also see that CVS currently has a PEG ratio of 1.17. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. CVS's industry had an average PEG ratio of 1.33 as of yesterday's close.

The Retail - Pharmacies and Drug Stores industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 21, putting it in the top 9% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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