Facebook (FB) closed the most recent trading day at $252.53, moving -0.9% from the previous trading session. This change was narrower than the S&P 500’s 1.12% loss on the day. At the same time, the Dow lost 0.88%, and the tech-heavy Nasdaq lost 1.07%.
Heading into today, shares of the social media company had lost 5.27% over the past month, lagging the Computer and Technology sector’s loss of 1.17% and the S&P 500’s loss of 0.59% in that time.
FB will be looking to display strength as it nears its next earnings release. On that day, FB is projected to report earnings of $1.90 per share, which would represent a year-over-year decline of 10.38%. Our most recent consensus estimate is calling for quarterly revenue of $19.65 billion, up 11.34% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $8.09 per share and revenue of $80.31 billion. These totals would mark changes of +25.82% and +13.6%, respectively, from last year.
Investors might also notice recent changes to analyst estimates for FB. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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. Within the past 30 days, our consensus EPS projection has moved 0.39% higher. FB currently has a Zacks Rank of #3 (Hold).
Looking at its valuation, FB is holding a Forward P/E ratio of 31.51. This valuation marks a discount compared to its industry’s average Forward P/E of 38.35.
Investors should also note that FB has a PEG ratio of 1.67 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. The Internet – Services industry currently had an average PEG ratio of 2.04 as of yesterday’s close.
The Internet – Services industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 186, which puts it in the bottom 27% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual 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.
You can find more information on all of these metrics, and much more, on Zacks.com.
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