In the latest trading session, Novartis (NVS) closed at $101.14, marking a -0.93% move from the previous day. This change lagged the S&P 500's 0.23% loss on the day. Elsewhere, the Dow lost 0.31%, while the tech-heavy Nasdaq lost 0.09%.
Coming into today, shares of the drugmaker had gained 1.24% in the past month. In that same time, the Medical sector lost 5.3%, while the S&P 500 lost 1.43%.
Novartis will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $1.78, up 12.66% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $13.54 billion, up 7.91% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $6.92 per share and revenue of $53.86 billion. These totals would mark changes of +13.44% and +6.55%, respectively, from last year.
Investors might also notice recent changes to analyst estimates for Novartis. Recent revisions tend to reflect the latest 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. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 0.05% lower within the past month. Novartis currently has a Zacks Rank of #3 (Hold).
In terms of valuation, Novartis is currently trading at a Forward P/E ratio of 14.76. For comparison, its industry has an average Forward P/E of 14.76, which means Novartis is trading at a no noticeable deviation to the group.
It is also worth noting that NVS currently has a PEG ratio of 1.76. 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. The Large Cap Pharmaceuticals industry currently had an average PEG ratio of 1.76 as of yesterday's close.
The Large Cap Pharmaceuticals industry is part of the Medical sector. This group has a Zacks Industry Rank of 211, putting it in the bottom 17% 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.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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