McKesson (MCK) closed at $698.31 in the latest trading session, marking a +1.19% move from the prior day. The stock exceeded the S&P 500, which registered a gain of 0.49% for the day. Meanwhile, the Dow gained 0.38%, and the Nasdaq, a tech-heavy index, added 0.72%.
The prescription drug distributor's stock has dropped by 2.25% in the past month, falling short of the Medical sector's gain of 1.93% and the S&P 500's gain of 2.99%.
Investors will be eagerly watching for the performance of McKesson in its upcoming earnings disclosure. The company's upcoming EPS is projected at $8.58, signifying a 21.36% increase compared to the same quarter of the previous year. Simultaneously, our latest consensus estimate expects the revenue to be $103.79 billion, showing a 10.82% escalation compared to the year-ago quarter.
For the annual period, the Zacks Consensus Estimates anticipate earnings of $37.21 per share and a revenue of $407.45 billion, signifying shifts of +12.59% and +13.48%, respectively, from the last year.
It's also important for investors to be aware of any recent modifications to analyst estimates for McKesson. Such recent modifications usually signify the changing landscape of near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.
Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. 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 last 30 days, the Zacks Consensus EPS estimate has moved 0.03% lower. At present, McKesson boasts a Zacks Rank of #3 (Hold).
Looking at valuation, McKesson is presently trading at a Forward P/E ratio of 18.55. This expresses a premium compared to the average Forward P/E of 14.6 of its industry.
Meanwhile, MCK's PEG ratio is currently 1.37. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Medical - Dental Supplies was holding an average PEG ratio of 1.75 at yesterday's closing price.
The Medical - Dental Supplies industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 91, which puts it in the top 37% 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.
You can find more information on all of these metrics, and much more, on Zacks.com.
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McKesson Corporation (MCK): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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