GlaxoSmithKline (GSK) closed at $40.55 in the latest trading session, marking a -1.39% move from the prior day. This move was narrower than the S&P 500's daily loss of 2.42%. Meanwhile, the Dow lost 2.84%, and the Nasdaq, a tech-heavy index, lost 2.59%.
Prior to today's trading, shares of the drug developer had lost 1.01% over the past month. This has lagged the Medical sector's gain of 0.72% and the S&P 500's gain of 4.5% in that time.
GSK will be looking to display strength as it nears its next earnings release. In that report, analysts expect GSK to post earnings of $0.60 per share. This would mark a year-over-year decline of 23.08%. Meanwhile, our latest consensus estimate is calling for revenue of $10.13 billion, up 0.94% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2.90 per share and revenue of $43.85 billion. These totals would mark changes of -8.52% and +1.86%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for GSK. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
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.
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 remained stagnant. GSK is currently sporting a Zacks Rank of #3 (Hold).
Digging into valuation, GSK currently has a Forward P/E ratio of 14.18. For comparison, its industry has an average Forward P/E of 15.37, which means GSK is trading at a discount to the group.
Investors should also note that GSK has a PEG ratio of 5.12 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. GSK's industry had an average PEG ratio of 2.12 as of yesterday's close.
The Large Cap Pharmaceuticals industry is part of the Medical sector. This group has a Zacks Industry Rank of 27, putting it in the top 11% 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.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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