Yahoo Finance CVS Health (CVS) Gains But Lags Market: What You Should Know
In the latest trading session, CVS Health (CVS) closed at $74.08, marking a +0.58% move from the previous day. This change lagged the S&P 500's 0.62% gain on the day. Meanwhile, the Dow gained 0.52%, and the Nasdaq, a tech-heavy index, added 0.86%.
Prior to today's trading, shares of the drugstore chain and pharmacy benefits manager had gained 11% over the past month. This has outpaced the Retail-Wholesale sector's gain of 2.64% and the S&P 500's gain of 1.98% in that time.
Investors will be hoping for strength from CVS as it approaches its next earnings release, which is expected to be November 5, 2018. On that day, CVS is projected to report earnings of $1.72 per share, which would represent year-over-year growth of 14.67%. Meanwhile, our latest consensus estimate is calling for revenue of $47.22 billion, up 2.25% from the prior-year quarter.
CVS's full-year Zacks Consensus Estimates are calling for earnings of $7.04 per share and revenue of $188.96 billion. These results would represent year-over-year changes of +19.32% and +2.27%, respectively.
Investors should also note any recent changes to analyst estimates for CVS. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
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, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.82% higher. CVS currently has a Zacks Rank of #3 (Hold).
Investors should also note CVS's current valuation metrics, including its Forward P/E ratio of 10.46. Its industry sports an average Forward P/E of 16.19, so we one might conclude that CVS is trading at a discount comparatively.
Also, we should mention that CVS has a PEG ratio of 0.99. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Retail - Pharmacies and Drug Stores industry currently had an average PEG ratio of 1.06 as of yesterday's close.
The Retail - Pharmacies and Drug Stores industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 78, which puts it in the top 31% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our 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.
You can find more information on all of these metrics, and much more, on Zacks.com.
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