U.S. Markets closed

Teva Pharmaceutical Industries Ltd. (TEVA) Gains But Lags Market: What You Should Know

Zacks Equity Research
FTI Consulting (FCN) reported earnings 30 days ago. What's next for the stock? We take a look at earnings estimates for some clues.

In the latest trading session, Teva Pharmaceutical Industries Ltd. (TEVA) closed at $15.78, marking a +0.19% move from the previous day. This move lagged the S&P 500's daily gain of 1.47%. Meanwhile, the Dow gained 0.79%, and the Nasdaq, a tech-heavy index, added 2.02%.

Coming into today, shares of the company had lost 14.17% in the past month. In that same time, the Medical sector gained 1.05%, while the S&P 500 gained 1.5%.

Investors will be hoping for strength from TEVA as it approaches its next earnings release. The company is expected to report EPS of $0.59, down 37.23% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $4.44 billion, down 12.37% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2.40 per share and revenue of $17.34 billion. These totals would mark changes of -17.81% and -8.05%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for TEVA. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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. Over the past month, the Zacks Consensus EPS estimate has moved 12.46% lower. TEVA is currently sporting a Zacks Rank of #5 (Strong Sell).

Digging into valuation, TEVA currently has a Forward P/E ratio of 6.56. This valuation marks a discount compared to its industry's average Forward P/E of 7.72.

It is also worth noting that TEVA currently has a PEG ratio of 2.88. 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 Medical - Generic Drugs industry currently had an average PEG ratio of 1.1 as of yesterday's close.

The Medical - Generic Drugs industry is part of the Medical sector. This group has a Zacks Industry Rank of 152, putting it in the bottom 41% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Teva Pharmaceutical Industries Ltd. (TEVA) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research