Perrigo (PRGO) Moves 6.1% Higher: Will This Strength Last?

Perrigo (PRGO) shares soared 6.1% in the last trading session to close at $14.68. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 6.2% loss over the past four weeks.

Perrigo’s stock price gain can likely be attributed to growing investor confidence in the company’s progress under its Three-S strategy as well as its focus on streamlining the portfolio and reducing debt. Perrigo’s execution of its Three-S strategy—Stabilize, Streamline and Strengthen—is improving its underlying business, with market-share gains in U.S. store-brand OTC products and key European brands. The company is also simplifying its portfolio through divestitures, with proceeds from the Dermacosmetics sale being used primarily to reduce debt and strengthen its balance sheet, improving financial flexibility. The company reiterated its guidance for 2026 with sequentially stronger second-half performance.

This drug company is expected to post quarterly earnings of $0.57 per share in its upcoming report, which represents a year-over-year change of -28.8%. Revenues are expected to be $994.67 million, down 4.7% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For Perrigo, the consensus EPS estimate for the quarter has been revised 2.8% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on PRGO going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Perrigo is part of the Zacks Medical - Products industry. Maravai LifeSciences Holdings, Inc. (MRVI), another stock in the same industry, closed the last trading session 3.8% higher at $7.65. MRVI has returned -17.2% in the past month.

For Maravai LifeSciences, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at -$0.06. This represents a change of +25% from what the company reported a year ago. Maravai LifeSciences currently has a Zacks Rank of #3 (Hold).

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This article originally published on Zacks Investment Research (zacks.com).

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