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Allergan (AGN) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research

Allergan (AGN) closed the most recent trading day at $165.56, moving -0.35% from the previous trading session. This change lagged the S&P 500's daily loss of 0.31%. Meanwhile, the Dow lost 0.52%, and the Nasdaq, a tech-heavy index, lost 0.28%.

Coming into today, shares of the Botox maker had gained 6.27% in the past month. In that same time, the Medical sector lost 0.98%, while the S&P 500 gained 2.92%.

Wall Street will be looking for positivity from AGN as it approaches its next earnings report date. In that report, analysts expect AGN to post earnings of $4.21 per share. This would mark a year-over-year decline of 0.89%. Meanwhile, our latest consensus estimate is calling for revenue of $3.85 billion, down 1.51% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $16.69 per share and revenue of $15.45 billion. These totals would mark changes of -0.02% and -2.14%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for AGN. These recent revisions tend to reflect the evolving nature of short-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. 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.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.06% higher within the past month. AGN is currently sporting a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that AGN has a Forward P/E ratio of 9.96 right now. This represents a premium compared to its industry's average Forward P/E of 7.72.

It is also worth noting that AGN currently has a PEG ratio of 1.71. 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. AGN's industry had an average PEG ratio of 0.88 as of yesterday's close.

The Medical - Generic Drugs industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 61, which puts it in the top 24% 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.

To follow AGN in the coming trading sessions, be sure to utilize Zacks.com.


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