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Canon (CAJ) Gains But Lags Market: What You Should Know

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Canon (CAJ - Free Report) closed at $25.07 in the latest trading session, marking a +0.44% move from the prior day. This change lagged the S&P 500's 0.62% gain on the day. Elsewhere, the Dow gained 0.55%, while the tech-heavy Nasdaq lost 0.03%.

Prior to today's trading, shares of the office machine company had gained 9.96% over the past month. This has outpaced the Computer and Technology sector's gain of 0.29% and the S&P 500's gain of 0.87% in that time.

Canon will be looking to display strength as it nears its next earnings release. In that report, analysts expect Canon to post earnings of $0.42 per share. This would mark a year-over-year decline of 14.29%. Meanwhile, our latest consensus estimate is calling for revenue of $9.26 billion, down 2.45% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1.76 per share and revenue of $32.62 billion. These totals would mark changes of +131.58% and +8.48%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for Canon. These revisions typically reflect the latest short-term business trends, which can change frequently. 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. Within the past 30 days, our consensus EPS projection has moved 0.19% higher. Canon is currently sporting a Zacks Rank of #3 (Hold).

In terms of valuation, Canon is currently trading at a Forward P/E ratio of 14.24. This represents a discount compared to its industry's average Forward P/E of 17.35.

We can also see that CAJ currently has a PEG ratio of 14.24. 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 Office Automation and Equipment was holding an average PEG ratio of 14.24 at yesterday's closing price.

The Office Automation and Equipment industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 72, which puts it in the top 29% 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.

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


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