Cardinal Health (CAH) Sees a More Significant Dip Than Broader Market: Some Facts to Know

In the latest trading session, Cardinal Health (CAH) closed at $211.87, marking a -2.08% move from the previous day. The stock's change was less than the S&P 500's daily loss of 1.36%. Meanwhile, the Dow experienced a drop of 1.64%, and the technology-dominated Nasdaq saw a decrease of 1.46%.

Shares of the prescription drug distributor have depreciated by 4.09% over the course of the past month, outperforming the Medical sector's loss of 5.66%, and lagging the S&P 500's loss of 1.76%.

The upcoming earnings release of Cardinal Health will be of great interest to investors. The company's earnings per share (EPS) are projected to be $2.8, reflecting a 19.15% increase from the same quarter last year. Meanwhile, the latest consensus estimate predicts the revenue to be $62.42 billion, indicating a 13.74% increase compared to the same quarter of the previous year.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $10.31 per share and revenue of $259.27 billion. These totals would mark changes of +25.12% and +16.48%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for Cardinal Health. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, 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. Within the past 30 days, our consensus EPS projection has moved 0.04% higher. Cardinal Health is currently sporting a Zacks Rank of #2 (Buy).

In terms of valuation, Cardinal Health is presently being traded at a Forward P/E ratio of 20.98. Its industry sports an average Forward P/E of 15.71, so one might conclude that Cardinal Health is trading at a premium comparatively.

Meanwhile, CAH's PEG ratio is currently 1.39. 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. The Medical - Dental Supplies industry had an average PEG ratio of 1.82 as trading concluded yesterday.

The Medical - Dental Supplies industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 62, which puts it in the top 26% of all 250+ industries.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

Free Report: Profiting from the 2nd Wave of AI Explosion

The next phase of the AI explosion is poised to create significant wealth for investors, especially those who get in early. It will add literally trillion of dollars to the economy and revolutionize nearly every part of our lives.

Investors who bought shares like Nvidia at the right time have had a shot at huge gains.

But the rocket ride in the "first wave" of AI stocks may soon come to an end. The sharp upward trajectory of these stocks will begin to level off, leaving exponential growth to a new wave of cutting-edge companies.

Zacks' AI Boom 2.0: The Second Wave report reveals 4 under-the-radar companies that may soon be shining stars of AI’s next leap forward.

Access AI Boom 2.0 now, absolutely free >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Cardinal Health, Inc. (CAH): Free Stock Analysis Report

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

Zacks Investment Research