GlaxoSmithKline (GSK) closed at $41.54 in the latest trading session, marking a +1.47% move from the prior day. This move outpaced the S&P 500's daily loss of 0.21%. Elsewhere, the Dow lost 0.58%, while the tech-heavy Nasdaq lost 0.46%.
GSK will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $0.60, down 23.08% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $10.13 billion, up 0.94% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $2.90 per share and revenue of $43.85 billion, which would represent changes of -8.52% and +1.86%, respectively, from the prior year.
Investors should also note any recent changes to analyst estimates for GSK. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.35% higher. GSK is currently a Zacks Rank #2 (Buy).
In terms of valuation, GSK is currently trading at a Forward P/E ratio of 14.12. For comparison, its industry has an average Forward P/E of 14.48, which means GSK is trading at a discount to the group.
Meanwhile, GSK's PEG ratio is currently 6.55. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Large Cap Pharmaceuticals was holding an average PEG ratio of 1.98 at yesterday's closing price.
The Large Cap Pharmaceuticals industry is part of the Medical sector. This group has a Zacks Industry Rank of 13, putting it in the top 6% 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.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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