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McKesson (MCK) closed the most recent trading day at $326.21, moving -0.56% from the previous trading session. This change was narrower than the S&P 500's 0.88% loss on the day. At the same time, the Dow lost 0.82%, and the tech-heavy Nasdaq gained 0.08%.
Prior to today's trading, shares of the prescription drug distributor had gained 1.82% over the past month. This has outpaced the Medical sector's loss of 4.6% and the S&P 500's loss of 8.06% in that time.
Wall Street will be looking for positivity from McKesson as it approaches its next earnings report date. This is expected to be August 3, 2022. The company is expected to report EPS of $5.29, down 4.86% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $63.87 billion, up 1.91% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $23.25 per share and revenue of $264.78 billion, which would represent changes of -1.86% and +0.31%, respectively, from the prior year.
Investors should also note any recent changes to analyst estimates for McKesson. 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.
Our research shows that these estimate changes are directly correlated with near-term stock prices. 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, 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. The Zacks Consensus EPS estimate has moved 0.02% lower within the past month. McKesson is currently sporting a Zacks Rank of #3 (Hold).
Digging into valuation, McKesson currently has a Forward P/E ratio of 14.11. This represents a discount compared to its industry's average Forward P/E of 18.93.
Also, we should mention that MCK has a PEG ratio of 1.5. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. MCK's industry had an average PEG ratio of 2.16 as of yesterday's close.
The Medical - Dental Supplies industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 222, which puts it in the bottom 13% 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.
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