AstraZeneca PLC (AZN) Loud Thud Doesn’t Negate The Long-Term Story

Despite closing 0.6 points higher on 13 March, AstraZeneca PLC (NYSE:AZN) remains a key investment for many, but the stock is also a popular trading vehicle. Here’s how to trade it using charts and trading levels Thursday. The shares accumulated 1.43 percent at $42.45 with a light trade volume of 2.971 million shares. After opening the session at $42.08, the shares went as high as $42.49 and as low as $41.95, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $108 billion and now has 2.53 billion shares outstanding. AstraZeneca PLC (AZN) stock has gained 15.73 percent of market value in 21 trading days.

AZN stock has a trailing 3-year beta of 0.51, offering the possibility of a lower rate of return, but also posing less risk. The portion of a company’s profit allocated to each outstanding share of common stock was $0.85 a share in the trailing twelve months. The stock’s value has surged 11.77 percent year to date (YTD) against a rise of 25.41 percent in 12 month’s time. The company’s shares still trade -0.38 percent away from its 1-year high of $42.61 and 26.15 percent up from 52-week low of $33.65. The average consensus rating on the company is 1.6, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a buy.

AstraZeneca PLC (AZN) will probably climb 7.82 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $54.88-month high price target. This represents a whopping 29.28 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $43.14, which represents a return potential of 1.63 percent when compared to the closing price of the stock of $42.45 on Wednesday, March 13. The lowest price target for the stock is $31.52 — slightly more than -25.75 percent from AZN’s current share price.

History has shown that shares in AstraZeneca PLC have gone down on 10 different earnings reaction days and are predicted to add 0.03 percent when the company reports upcoming earnings. Investors will get their next glimpse of AZN’s Q1 earnings on April 26. Analysts are forecasting revenue to climb 5.8 percent to $5.48B in the fiscal first quarter, while earnings are seen soaring by nearly 58.33 percent to $0.38 per share. It earned $0.79 per share, better than the $0.76, adjusted, expected by Thomson Reuters consensus estimate. Revenue was $6.42B, better than the $6.27B analysts expected. Earnings are estimated to increase by -9.6 percent this year, 22.08 percent next year and continue to increase by 20.7 percent annually for the next 5 years.

The stock is currently hovering around the first support level of $42.1. Below this, the next support is placed in the zone of $41.76. Till the time, the AZN stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 66.5 on daily chart, which may remain a cause for concern. If the price breaks below $41.76 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $42.64 mark may result into a pull-back move towards $42.84 level.

Shares of AstraZeneca PLC (AZN) are trading at a P/E ratio of 49.21 times earnings reported for the past 12 months. The industry AZN operates in has an average P/E of 33.75. Its P/E ratio went as low as 19.77X and as high as 72.15 over the 5-year span.Further, it is sporting a 4.87 on the Price-to-Sales ratio. Compare this with the industry average P/S of 8.71. 79.6 percent is the gross profit margin for AstraZeneca PLC and operating margin sits at 15.3 percent. Along with this, the net profit margin is 9.8 percent.