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CVS Health (CVS) Stock Moves -1.15%: What You Should Know

Zacks Equity Research
·3 min read

In the latest trading session, CVS Health (CVS) closed at $59.56, marking a -1.15% move from the previous day. This change was narrower than the S&P 500's 1.86% loss on the day. At the same time, the Dow lost 2.3%, and the tech-heavy Nasdaq lost 1.64%.

Heading into today, shares of the drugstore chain and pharmacy benefits manager had gained 6.24% over the past month, lagging the Retail-Wholesale sector's gain of 8.32% and the S&P 500's gain of 7.63% in that time.

Wall Street will be looking for positivity from CVS as it approaches its next earnings report date. This is expected to be November 6, 2020. On that day, CVS is projected to report earnings of $1.33 per share, which would represent a year-over-year decline of 27.72%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $66.36 billion, up 2.38% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $7.23 per share and revenue of $266.81 billion. These totals would mark changes of +2.12% and +3.91%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for CVS. These revisions typically reflect the latest short-term business trends, which can change frequently. 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. 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.

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. The Zacks Consensus EPS estimate has moved 0.04% higher within the past month. CVS currently has a Zacks Rank of #2 (Buy).

Valuation is also important, so investors should note that CVS has a Forward P/E ratio of 8.33 right now. This valuation marks a no noticeable deviation compared to its industry's average Forward P/E of 8.33.

Meanwhile, CVS's PEG ratio is currently 1.49. 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 1.52 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 206, putting it in the bottom 19% 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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Zacks Investment Research