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GSK (GSK) Outpaces Stock Market Gains: What You Should Know

GSK (GSK) closed at $37.71 in the latest trading session, marking a +0.75% move from the prior day. This change outpaced the S&P 500's 0.4% gain on the day. Elsewhere, the Dow gained 0.13%, while the tech-heavy Nasdaq added 0.45%.

Coming into today, shares of the drug developer had gained 7.65% in the past month. In that same time, the Medical sector lost 5.26%, while the S&P 500 lost 1.38%.

Investors will be hoping for strength from GSK as it approaches its next earnings release. In that report, analysts expect GSK to post earnings of $1.04 per share. This would mark a year-over-year decline of 4.59%. Our most recent consensus estimate is calling for quarterly revenue of $9.63 billion, up 4.42% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.79 per share and revenue of $37.07 billion. These totals would mark changes of +9.54% and -6.64%, respectively, from last year.

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It is also important to note the recent changes to analyst estimates for GSK. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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. Within the past 30 days, our consensus EPS projection has moved 1.05% lower. GSK currently has a Zacks Rank of #3 (Hold).

Looking at its valuation, GSK is holding a Forward P/E ratio of 9.87. For comparison, its industry has an average Forward P/E of 16.9, which means GSK is trading at a discount to the group.

Investors should also note that GSK has a PEG ratio of 1.97 right now. 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. GSK's industry had an average PEG ratio of 2.13 as of yesterday's close.

The Medical - Biomedical and Genetics industry is part of the Medical sector. This group has a Zacks Industry Rank of 93, putting it in the top 37% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. 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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