In the latest close session, Snap (SNAP) was down 3.54% at $7.64. The stock fell short of the S&P 500, which registered a gain of 0.21% for the day. Elsewhere, the Dow gained 1.35%, while the tech-heavy Nasdaq lost 0.26%.
Shares of the company behind Snapchat have depreciated by 12.87% over the course of the past month, underperforming the Computer and Technology sector's gain of 2.05%, and the S&P 500's gain of 0.89%.
Investors will be eagerly watching for the performance of Snap in its upcoming earnings disclosure. It is anticipated that the company will report an EPS of $0.15, marking a 6.25% fall compared to the same quarter of the previous year. Meanwhile, our latest consensus estimate is calling for revenue of $1.7 billion, up 9.12% from the prior-year quarter.
For the full year, the Zacks Consensus Estimates project earnings of $0.32 per share and a revenue of $5.91 billion, demonstrating changes of +10.34% and +10.31%, respectively, from the preceding 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. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 8.03% upward. Right now, Snap possesses a Zacks Rank of #2 (Buy).
Digging into valuation, Snap currently has a Forward P/E ratio of 24.75. This expresses a discount compared to the average Forward P/E of 29.38 of its industry.
Also, we should mention that SNAP has a PEG ratio of 1.14. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Internet - Software industry had an average PEG ratio of 2.01 as trading concluded yesterday.
The Internet - Software industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 59, finds itself in the top 24% echelons of all 250+ industries.
The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.
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Snap Inc. (SNAP): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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