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Cardinal Health (CAH) Stock Sinks As Market Gains: What You Should Know

In the latest trading session, Cardinal Health (CAH) closed at $69.01, marking a -1.33% move from the previous day. This move lagged the S&P 500's daily gain of 0.3%. At the same time, the Dow added 0.24%, and the tech-heavy Nasdaq gained 0.34%.

Heading into today, shares of the prescription drug distributor had lost 9.78% over the past month, lagging the Medical sector's loss of 2.43% and the S&P 500's loss of 1.21% in that time.

Cardinal Health will be looking to display strength as it nears its next earnings release. On that day, Cardinal Health is projected to report earnings of $1.46 per share, which would represent year-over-year growth of 0.69%. Meanwhile, our latest consensus estimate is calling for revenue of $49.05 billion, up 9.39% from the prior-year quarter.

CAH's full-year Zacks Consensus Estimates are calling for earnings of $5.42 per share and revenue of $201.83 billion. These results would represent year-over-year changes of +7.11% and +11.29%, respectively.

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Any recent changes to analyst estimates for Cardinal Health should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

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, 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 remained stagnant. Cardinal Health is currently a Zacks Rank #3 (Hold).

Looking at its valuation, Cardinal Health is holding a Forward P/E ratio of 12.9. For comparison, its industry has an average Forward P/E of 19.54, which means Cardinal Health is trading at a discount to the group.

Investors should also note that CAH has a PEG ratio of 1.12 right now. 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. Medical - Dental Supplies stocks are, on average, holding a PEG ratio of 2 based on yesterday's closing prices.

The Medical - Dental Supplies industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 60, which puts it in the top 24% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.

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Cardinal Health, Inc. (CAH) : Free Stock Analysis Report

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Zacks Investment Research