Select Medical (SEM) Stock Sinks As Market Gains: What You Should Know
Select Medical (SEM) closed at $34.68 in the latest trading session, marking a -1.14% move from the prior day. This change lagged the S&P 500's 0.7% gain on the day. Elsewhere, the Dow gained 0.32%, while the tech-heavy Nasdaq added 1.23%.
Coming into today, shares of the hospital and rehabilitation center operator had gained 29.97% in the past month. In that same time, the Medical sector lost 2.6%, while the S&P 500 gained 0.18%.
Investors will be hoping for strength from SEM as it approaches its next earnings release. On that day, SEM is projected to report earnings of $0.65 per share, which would represent year-over-year growth of 75.68%. Meanwhile, our latest consensus estimate is calling for revenue of $1.48 billion, up 4.37% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2.23 per share and revenue of $5.9 billion. These totals would mark changes of +17.99% and +6.7%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for SEM. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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 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. Over the past month, the Zacks Consensus EPS estimate has moved 47.35% higher. SEM is currently sporting a Zacks Rank of #1 (Strong Buy).
Digging into valuation, SEM currently has a Forward P/E ratio of 15.77. Its industry sports an average Forward P/E of 18.01, so we one might conclude that SEM is trading at a discount comparatively.
Also, we should mention that SEM has a PEG ratio of 1.05. 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. SEM's industry had an average PEG ratio of 1.36 as of yesterday's close.
The Medical - HMOs industry is part of the Medical sector. This group has a Zacks Industry Rank of 113, putting it in the top 45% 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.
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