Cardinal Health (CAH) Stock Declines While Market Improves: Some Information for Investors

In the latest trading session, Cardinal Health (CAH) closed at $162.17, marking a -1.27% move from the previous day. The stock trailed the S&P 500, which registered a daily gain of 0.28%. Elsewhere, the Dow gained 0.43%, while the tech-heavy Nasdaq added 0.09%.

The stock of prescription drug distributor has risen by 6.99% in the past month, leading the Medical sector's gain of 0.24% and the S&P 500's gain of 4.37%.

The investment community will be closely monitoring the performance of Cardinal Health in its forthcoming earnings report. The company's earnings per share (EPS) are projected to be $2.03, reflecting a 10.33% increase from the same quarter last year. Meanwhile, the latest consensus estimate predicts the revenue to be $60.67 billion, indicating a 1.34% increase compared to the same quarter of the previous year.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $8.18 per share and a revenue of $223.09 billion, representing changes of +8.63% and 0%, respectively, from the prior year.

Any recent changes to analyst estimates for Cardinal Health should also be noted by investors. Such recent modifications usually signify the changing landscape of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. 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, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 2.01% higher. As of now, Cardinal Health holds a Zacks Rank of #2 (Buy).

Looking at its valuation, Cardinal Health is holding a Forward P/E ratio of 17.84. This represents a discount compared to its industry average Forward P/E of 18.48.

One should further note that CAH currently holds a PEG ratio of 1.63. 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. Medical - Dental Supplies stocks are, on average, holding a PEG ratio of 1.73 based on yesterday's closing prices.

The Medical - Dental Supplies industry is part of the Medical sector. With its current Zacks Industry Rank of 38, this industry ranks in the top 16% of all industries, numbering over 250.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.

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This article originally published on Zacks Investment Research (zacks.com).

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