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Patterson Cos. (PDCO) Rises But Trails Market: What Investors Should Know

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The latest trading session saw Patterson Cos. (PDCO - Free Report) ending at $30.05, denoting a +0.07% adjustment from its last day's close. This move lagged the S&P 500's daily gain of 0.76%. Meanwhile, the Dow gained 0.59%, and the Nasdaq, a tech-heavy index, added 1.12%.

Heading into today, shares of the medical supplies maker had gained 5.55% over the past month, outpacing the Medical sector's gain of 1.57% and the S&P 500's gain of 2.5% in that time.

The upcoming earnings release of Patterson Cos. will be of great interest to investors. In that report, analysts expect Patterson Cos. to post earnings of $0.60 per share. This would mark a year-over-year decline of 3.23%. Our most recent consensus estimate is calling for quarterly revenue of $1.63 billion, up 2% from the year-ago period.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $2.38 per share and a revenue of $6.62 billion, representing changes of -1.65% and +2.31%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for Patterson Cos. Such recent modifications usually signify the changing landscape of near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, there's been a 0.05% fall in the Zacks Consensus EPS estimate. Patterson Cos. is currently a Zacks Rank #5 (Strong Sell).

In terms of valuation, Patterson Cos. is currently trading at a Forward P/E ratio of 12.64. This signifies a discount in comparison to the average Forward P/E of 19.64 for its industry.

It's also important to note that PDCO currently trades at a PEG ratio of 1.51. 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. PDCO's industry had an average PEG ratio of 1.9 as of yesterday's close.

The Medical - Dental Supplies industry is part of the Medical sector. Currently, this industry holds a Zacks Industry Rank of 171, positioning it in the bottom 33% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our 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.

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


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