Amneal Pharmaceuticals (AMRX) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research
·3-min read

Amneal Pharmaceuticals (AMRX) closed the most recent trading day at $4.36, moving -1.13% from the previous trading session. This move lagged the S&P 500's daily gain of 1.2%. Meanwhile, the Dow gained 0.53%, and the Nasdaq, a tech-heavy index, added 1.64%.

Heading into today, shares of the pharmaceutical company had gained 13.66% over the past month, outpacing the Medical sector's loss of 4.59% and the S&P 500's loss of 2.23% in that time.

Wall Street will be looking for positivity from AMRX as it approaches its next earnings report date. This is expected to be November 6, 2020. On that day, AMRX is projected to report earnings of $0.13 per share, which would represent year-over-year growth of 225%. Meanwhile, our latest consensus estimate is calling for revenue of $480.27 million, up 26.96% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $0.59 per share and revenue of $1.94 billion. These totals would mark changes of +68.57% and +19.29%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for AMRX. These revisions typically reflect the latest short-term business trends, which can change frequently. 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. 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. The Zacks Consensus EPS estimate has moved 2.6% higher within the past month. AMRX is holding a Zacks Rank of #2 (Buy) right now.

Investors should also note AMRX's current valuation metrics, including its Forward P/E ratio of 7.46. Its industry sports an average Forward P/E of 17.82, so we one might conclude that AMRX is trading at a discount comparatively.

The Medical - Drugs industry is part of the Medical sector. This group has a Zacks Industry Rank of 166, putting it in the bottom 35% 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.

To follow AMRX in the coming trading sessions, be sure to utilize Zacks.com.


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