In the latest trading session, CVS Health (CVS - Free Report) closed at $78.92, marking a -0.72% move from the previous day. This move was narrower than the S&P 500's daily loss of 3.29%. At the same time, the Dow lost 3.15%, and the tech-heavy Nasdaq lost 4.08%.
Heading into today, shares of the drugstore chain and pharmacy benefits manager had gained 4.97% over the past month, outpacing the Retail-Wholesale sector's loss of 6.44% and the S&P 500's gain of 0.44% in that time.
CVS will be looking to display strength as it nears its next earnings release, which is expected to be November 6, 2018. The company is expected to report EPS of $1.71, up 14% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $47.22 billion, up 2.25% from the prior-year quarter.
CVS's full-year Zacks Consensus Estimates are calling for earnings of $7.05 per share and revenue of $188.95 billion. These results would represent year-over-year changes of +19.49% and +2.27%, respectively.
Investors might also notice recent changes to analyst estimates for CVS. These recent revisions tend to reflect the evolving nature of short-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. Over the past month, the Zacks Consensus EPS estimate has moved 0.02% higher. 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 11.28. This valuation marks a discount compared to its industry's average Forward P/E of 11.41.
Also, we should mention that CVS has a PEG ratio of 1.06. 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 Retail - Pharmacies and Drug Stores industry currently had an average PEG ratio of 1.09 as of yesterday's close.
The Retail - Pharmacies and Drug Stores industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 172, putting it in the bottom 33% 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.
You can find more information on all of these metrics, and much more, on Zacks.com.