In the latest close session, Novo Nordisk (NVO) was down 2.41% at $48.19. This move lagged the S&P 500’s daily loss of 0.14%. Elsewhere, the Dow saw a downswing of 0.01%, while the tech-heavy Nasdaq depreciated by 0.57%.
The drugmaker’s shares have seen an increase of 4.13% over the last month, not keeping up with the Medical sector’s gain of 5.8% and outstripping the S&P 500’s gain of 0.25%.
Analysts and investors alike will be keeping a close eye on the performance of Novo Nordisk in its upcoming earnings disclosure. In that report, analysts expect Novo Nordisk to post earnings of $0.82 per share. This would mark a year-over-year decline of 15.46%. At the same time, our most recent consensus estimate is projecting a revenue of $11.27 billion, reflecting a 3.58% fall from the equivalent quarter last year.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $3.39 per share and revenue of $44.61 billion. These totals would mark changes of -14.39% and -4.63%, respectively, from last year.
Investors might also notice recent changes to analyst estimates for Novo Nordisk. Such recent modifications usually signify the changing landscape of near-term business trends. Consequently, upward revisions in estimates express analysts’ positivity towards the business operations and its ability to generate profits.
Our research demonstrates that these adjustments in estimates directly associate with imminent 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 varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 1.99% decrease. At present, Novo Nordisk boasts a Zacks Rank of #5 (Strong Sell).
In terms of valuation, Novo Nordisk is currently trading at a Forward P/E ratio of 14.59. For comparison, its industry has an average Forward P/E of 16.35, which means Novo Nordisk is trading at a discount to the group.
Investors should also note that NVO has a PEG ratio of 4.5 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. The Large Cap Pharmaceuticals industry currently had an average PEG ratio of 2.66 as of yesterday’s close.