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T. Rowe Price (TROW) Outpaces Stock Market Gains: What You Should Know

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T. Rowe Price (TROW - Free Report) closed at $114.59 in the latest trading session, marking a +0.97% move from the prior day. This move outpaced the S&P 500's daily gain of 0.07%. At the same time, the Dow added 0.12%, and the tech-heavy Nasdaq lost 1.47%.

Prior to today's trading, shares of the financial services firm had lost 9.8% over the past month. This has lagged the Finance sector's loss of 1.99% and the S&P 500's loss of 2% in that time.

Wall Street will be looking for positivity from T. Rowe Price as it approaches its next earnings report date. On that day, T. Rowe Price is projected to report earnings of $1.59 per share, which would represent a year-over-year decline of 39.31%. Our most recent consensus estimate is calling for quarterly revenue of $1.52 billion, down 18.38% from the year-ago period.

TROW's full-year Zacks Consensus Estimates are calling for earnings of $6.64 per share and revenue of $6.16 billion. These results would represent year-over-year changes of -17.21% and -5%, respectively.

It is also important to note the recent changes to analyst estimates for T. Rowe Price. 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.

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. The Zacks Consensus EPS estimate has moved 1.71% higher within the past month. T. Rowe Price is currently a Zacks Rank #3 (Hold).

In terms of valuation, T. Rowe Price is currently trading at a Forward P/E ratio of 17.1. This valuation marks a premium compared to its industry's average Forward P/E of 11.36.

Also, we should mention that TROW has a PEG ratio of 2.85. 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 Financial - Investment Management industry currently had an average PEG ratio of 1.54 as of yesterday's close.

The Financial - Investment Management industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 46, which puts it in the top 19% 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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