In the latest trading session, Western Digital (WDC) closed at $118.86, marking a +2.98% move from the previous day. The stock's change was more than the S&P 500's daily gain of 1.56%. Elsewhere, the Dow saw an upswing of 1.29%, while the tech-heavy Nasdaq appreciated by 2.21%.
Coming into today, shares of the maker of hard drives for businesses and personal computers had gained 18.19% in the past month. In that same time, the Computer and Technology sector gained 1.06%, while the S&P 500 gained 0.41%.
The investment community will be paying close attention to the earnings performance of Western Digital in its upcoming release. The company is expected to report EPS of $1.58, down 11.24% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.7 billion, down 34.03% from the year-ago period.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $6.62 per share and a revenue of $10.92 billion, representing changes of +34.28% and -17.76%, respectively, from the prior year.
Investors should also take note of any recent adjustments to analyst estimates for Western Digital. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
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, 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. Over the past month, there's been a 1.74% rise in the Zacks Consensus EPS estimate. Western Digital is currently sporting a Zacks Rank of #1 (Strong Buy).
Looking at valuation, Western Digital is presently trading at a Forward P/E ratio of 17.44. Its industry sports an average Forward P/E of 17.44, so one might conclude that Western Digital is trading at no noticeable deviation comparatively.
Meanwhile, WDC's PEG ratio is currently 0.9. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. By the end of yesterday's trading, the Computer- Storage Devices industry had an average PEG ratio of 2.
The Computer- Storage Devices industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 93, putting it in the top 38% of all 250+ industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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Western Digital Corporation (WDC): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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