CVS Health (CVS) Gains But Lags Market: What You Should Know
CVS Health (CVS) closed at $87.68 in the latest trading session, marking a +0.18% move from the prior day. The stock lagged the S&P 500's daily gain of 0.48%.
Coming into today, shares of the drugstore chain and pharmacy benefits manager had gained 3.32% in the past month. In that same time, the Retail-Wholesale sector gained 1.4%, while the S&P 500 gained 3.46%.
Wall Street will be looking for positivity from CVS as it approaches its next earnings report date. This is expected to be November 3, 2021. The company is expected to report EPS of $1.78, up 7.23% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $70.23 billion, up 4.74% from the year-ago period.
CVS's full-year Zacks Consensus Estimates are calling for earnings of $7.77 per share and revenue of $282.99 billion. These results would represent year-over-year changes of +3.6% and +5.32%, respectively.
Investors might also notice recent changes to analyst estimates for CVS. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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 has moved 0.8% lower. CVS is holding a Zacks Rank of #3 (Hold) right now.
In terms of valuation, CVS is currently trading at a Forward P/E ratio of 11.26. Its industry sports an average Forward P/E of 10, so we one might conclude that CVS is trading at a premium comparatively.
It is also worth noting that CVS currently has a PEG ratio of 1.77. 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 was holding an average PEG ratio of 1.99 at yesterday's closing price.
The Retail - Pharmacies and Drug Stores industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 233, putting it in the bottom 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 Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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