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GlaxoSmithKline (GSK) Dips More Than Broader Markets: What You Should Know

GlaxoSmithKline (GSK) closed at $43.54 in the latest trading session, marking a -0.3% move from the prior day.

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This story originally appeared on Zacks

GlaxoSmithKline (GSK) closed the most recent trading day at $43.54, moving -0.3% from the previous trading session. This change lagged the S&P 500's 0.06% loss on the day. Meanwhile, the Dow gained 0.59%, and the Nasdaq, a tech-heavy index, lost 0.3%.

- Zacks

Coming into today, shares of the drug developer had gained 4.57% in the past month. In that same time, the Medical sector gained 4.74%, while the S&P 500 gained 5.76%.

GlaxoSmithKline will be looking to display strength as it nears its next earnings release. On that day, GlaxoSmithKline is projected to report earnings of $0.67 per share, which would represent year-over-year growth of 8.06%. Our most recent consensus estimate is calling for quarterly revenue of $12.8 billion, up 10.89% from the year-ago period.

Investors might also notice recent changes to analyst estimates for GlaxoSmithKline. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

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 ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.46% lower. GlaxoSmithKline is holding a Zacks Rank of #3 (Hold) right now.

Digging into valuation, GlaxoSmithKline currently has a Forward P/E ratio of 13.44. Its industry sports an average Forward P/E of 12.6, so we one might conclude that GlaxoSmithKline is trading at a premium comparatively.

We can also see that GSK currently has a PEG ratio of 2.33. 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. Large Cap Pharmaceuticals stocks are, on average, holding a PEG ratio of 2.03 based on yesterday's closing prices.

The Large Cap Pharmaceuticals industry is part of the Medical sector. This group has a Zacks Industry Rank of 111, putting it in the top 44% 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.



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