Back to top

Image: Bigstock

Amgen (AMGN) Gains But Lags Market: What You Should Know

Read MoreHide Full Article

In the latest trading session, Amgen (AMGN - Free Report) closed at $233.02, marking a +1.12% move from the previous day. The stock lagged the S&P 500's daily gain of 3.06%. Meanwhile, the Dow gained 2.8%, and the Nasdaq, a tech-heavy index, added 0.18%.

Heading into today, shares of the world's largest biotech drugmaker had lost 4.92% over the past month, lagging the Medical sector's loss of 2.73% and outpacing the S&P 500's loss of 6.15% in that time.

Investors will be hoping for strength from Amgen as it approaches its next earnings release. In that report, analysts expect Amgen to post earnings of $4.51 per share. This would mark a year-over-year decline of 3.43%. Meanwhile, our latest consensus estimate is calling for revenue of $6.59 billion, down 1.69% from the prior-year quarter.

AMGN's full-year Zacks Consensus Estimates are calling for earnings of $17.45 per share and revenue of $26.15 billion. These results would represent year-over-year changes of +2.05% and +0.66%, respectively.

Investors should also note any recent changes to analyst estimates for Amgen. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

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.

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. Within the past 30 days, our consensus EPS projection remained stagnant. Amgen is holding a Zacks Rank of #3 (Hold) right now.

Valuation is also important, so investors should note that Amgen has a Forward P/E ratio of 13.2 right now. For comparison, its industry has an average Forward P/E of 19.05, which means Amgen is trading at a discount to the group.

Investors should also note that AMGN has a PEG ratio of 1.86 right now. 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 Medical - Biomedical and Genetics industry currently had an average PEG ratio of 1.34 as of yesterday's close.

The Medical - Biomedical and Genetics industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 77, 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.

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


In-Depth Zacks Research for the Tickers Above


Normally $25 each - click below to receive one report FREE:


Amgen Inc. (AMGN) - free report >>

Published in