Why Novo Nordisk (NVO) Dipped More Than Broader Market Today
Novo Nordisk (NVO) ended the recent trading session at $131.24, demonstrating a -1.38% swing from the preceding day's closing price. The stock trailed the S&P 500, which registered a daily loss of 0.11%. Meanwhile, the Dow experienced a rise of 0.12%, and the technology-dominated Nasdaq saw a decrease of 0.41%.
The drugmaker's shares have seen an increase of 9.79% over the last month, surpassing the Medical sector's gain of 3.03% and the S&P 500's gain of 2.7%.
The upcoming earnings release of Novo Nordisk will be of great interest to investors. On that day, Novo Nordisk is projected to report earnings of $0.79 per share, which would represent year-over-year growth of 23.44%.
NVO's full-year Zacks Consensus Estimates are calling for earnings of $3.36 per share and revenue of $41.91 billion. These results would represent year-over-year changes of +24.44% and +24.33%, respectively.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Novo Nordisk. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1.92% higher. Novo Nordisk is currently sporting a Zacks Rank of #3 (Hold).
Valuation is also important, so investors should note that Novo Nordisk has a Forward P/E ratio of 39.62 right now. For comparison, its industry has an average Forward P/E of 14.4, which means Novo Nordisk is trading at a premium to the group.
Also, we should mention that NVO has a PEG ratio of 2.19. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The Large Cap Pharmaceuticals was holding an average PEG ratio of 1.67 at yesterday's closing price.
The Large Cap Pharmaceuticals industry is part of the Medical sector. This group has a Zacks Industry Rank of 190, putting it in the bottom 25% 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.
Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.
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Novo Nordisk A/S (NVO) : Free Stock Analysis Report
