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CVS Health (CVS) Stock Moves -0.5%: What You Should Know

Zacks Equity Research

In the latest trading session, CVS Health (CVS) closed at $59.38, marking a -0.5% move from the previous day. This move was narrower than the S&P 500's daily loss of 1.6%. Elsewhere, the Dow lost 1.84%, while the tech-heavy Nasdaq lost 0.95%.

Heading into today, shares of the drugstore chain and pharmacy benefits manager had lost 6.79% over the past month, lagging the Retail-Wholesale sector's loss of 6.56% and outpacing the S&P 500's loss of 10.82% in that time.

CVS will be looking to display strength as it nears its next earnings release. In that report, analysts expect CVS to post earnings of $1.68 per share. This would mark year-over-year growth of 3.7%. Our most recent consensus estimate is calling for quarterly revenue of $63.29 billion, up 2.67% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $7.16 per share and revenue of $259.63 billion. These totals would mark changes of +1.13% and +1.11%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for CVS. Recent revisions tend to reflect the latest near-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. 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, 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. The Zacks Consensus EPS estimate has moved 0.38% higher within the past month. CVS is currently sporting a Zacks Rank of #3 (Hold).

Digging into valuation, CVS currently has a Forward P/E ratio of 8.34. For comparison, its industry has an average Forward P/E of 9.24, which means CVS is trading at a discount to the group.

It is also worth noting that CVS currently has a PEG ratio of 1.3. 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. CVS's industry had an average PEG ratio of 1.24 as of yesterday's close.

The Retail - Pharmacies and Drug Stores industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 95, which puts it in the top 38% 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 CVS in the coming trading sessions, be sure to utilize Zacks.com.

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