Why the Market Dipped But Novo Nordisk (NVO) Gained Today
Novo Nordisk (NVO) closed at $129.05 in the latest trading session, marking a +0.23% move from the prior day. The stock's change was more than the S&P 500's daily loss of 0.31%. Elsewhere, the Dow saw a downswing of 0.41%, while the tech-heavy Nasdaq depreciated by 0.27%.
Heading into today, shares of the drugmaker had gained 4.3% over the past month, outpacing the Medical sector's loss of 0.57% and the S&P 500's gain of 3.05% in that time.
Investors will be eagerly watching for the performance of Novo Nordisk in its upcoming earnings disclosure. The company's earnings per share (EPS) are projected to be $0.79, reflecting a 23.44% increase from the same quarter last year. Meanwhile, the latest consensus estimate predicts the revenue to be $9.48 billion, indicating a 23.23% increase compared to the same quarter of the previous year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $3.36 per share and a revenue of $41.9 billion, indicating changes of +24.44% and +24.3%, respectively, from the former year.
Investors should also pay attention to any latest changes in analyst estimates for Novo Nordisk. 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.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. 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, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 1.11% upward. Novo Nordisk is holding a Zacks Rank of #3 (Hold) right now.
In the context of valuation, Novo Nordisk is at present trading with a Forward P/E ratio of 38.38. This expresses a premium compared to the average Forward P/E of 14.44 of its industry.
We can additionally observe that NVO currently boasts a PEG ratio of 2.12. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Large Cap Pharmaceuticals industry currently had an average PEG ratio of 1.73 as of yesterday's close.
The Large Cap Pharmaceuticals industry is part of the Medical sector. Currently, this industry holds a Zacks Industry Rank of 206, positioning it in the bottom 19% of all 250+ industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.
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Novo Nordisk A/S (NVO) : Free Stock Analysis Report
