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CVS Health (CVS) Stock Sinks As Market Gains: What You Should Know

In the latest trading session, CVS Health (CVS) closed at $57.44, marking a -0.19% move from the previous day. This change lagged the S&P 500's daily gain of 0.02%. Meanwhile, the Dow gained 0.1%, and the Nasdaq, a tech-heavy index, added 0.17%.

Coming into today, shares of the drugstore chain and pharmacy benefits manager had gained 5.42% in the past month. In that same time, the Retail-Wholesale sector gained 6.09%, while the S&P 500 gained 4.82%.

Investors will be hoping for strength from CVS as it approaches its next earnings release, which is expected to be August 7, 2019. In that report, analysts expect CVS to post earnings of $1.70 per share. This would mark year-over-year growth of 0.59%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $62.63 billion, up 34.09% from the year-ago period.

CVS's full-year Zacks Consensus Estimates are calling for earnings of $6.86 per share and revenue of $252.64 billion. These results would represent year-over-year changes of -3.11% and +30.16%, respectively.

It is also important to note the recent changes to analyst estimates for CVS. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an 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 0.05% higher. CVS currently has a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that CVS has a Forward P/E ratio of 8.39 right now. This valuation marks a discount compared to its industry's average Forward P/E of 9.31.

Also, we should mention that CVS has a PEG ratio of 1.16. 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. Retail - Pharmacies and Drug Stores stocks are, on average, holding a PEG ratio of 1.25 based on yesterday's closing prices.

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 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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