In the latest trading session, Snap (SNAP) closed at $5.26, marking a -1.31% move from the previous day. The stock's change was less than the S&P 500's daily gain of 0.5%. Meanwhile, the Dow gained 0.7%, and the Nasdaq, a tech-heavy index, added 0.31%.
Shares of the company behind Snapchat witnessed a loss of 0.56% over the previous month, trailing the performance of the Computer and Technology sector with its loss of 0.42%, and the S&P 500's loss of 0.23%.
The upcoming earnings release of Snap will be of great interest to investors. The company is predicted to post an EPS of $0.07, indicating a 800% growth compared to the equivalent quarter last year. Simultaneously, our latest consensus estimate expects the revenue to be $1.53 billion, showing a 13.99% escalation compared to the year-ago quarter.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $0.6 per share and revenue of $6.7 billion. These totals would mark changes of +81.82% and +12.91%, respectively, from last year.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Snap. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. 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, 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, the Zacks Consensus EPS estimate has moved 12.77% higher. Snap currently has a Zacks Rank of #3 (Hold).
From a valuation perspective, Snap is currently exchanging hands at a Forward P/E ratio of 8.94. For comparison, its industry has an average Forward P/E of 18.49, which means Snap is trading at a discount to the group.
Meanwhile, SNAP's PEG ratio is currently 0.17. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. As the market closed yesterday, the Internet - Software industry was having an average PEG ratio of 1.01.
The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 85, putting it in the top 35% 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.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
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Snap Inc. (SNAP): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).