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McKesson (MCK) Gains As Market Dips: What You Should Know
McKesson (MCK - Free Report) closed the most recent trading day at $336.20, moving +0.07% from the previous trading session. This change outpaced the S&P 500's 1.45% loss on the day. Elsewhere, the Dow lost 1.07%, while the tech-heavy Nasdaq lost 3.06%.
Heading into today, shares of the prescription drug distributor had lost 7.28% over the past month, lagging the Medical sector's loss of 4.01% and the S&P 500's loss of 3.83% in that time.
Investors will be hoping for strength from McKesson as it approaches its next earnings release. On that day, McKesson is projected to report earnings of $7.14 per share, which would represent year-over-year growth of 22.47%. Our most recent consensus estimate is calling for quarterly revenue of $67.93 billion, up 2.77% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $25.93 per share and revenue of $275.74 billion. These totals would mark changes of +9.46% and +4.46%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for McKesson. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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. Over the past month, the Zacks Consensus EPS estimate has moved 0.1% lower. McKesson is currently sporting a Zacks Rank of #3 (Hold).
In terms of valuation, McKesson is currently trading at a Forward P/E ratio of 12.96. This valuation marks a discount compared to its industry's average Forward P/E of 19.48.
Meanwhile, MCK's PEG ratio is currently 1.25. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. MCK's industry had an average PEG ratio of 1.96 as of yesterday's close.
The Medical - Dental Supplies industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 52, which puts it in the top 21% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. 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.