Twitter (TWTR) closed at $37.36 in the latest trading session, marking a -1.66% move from the prior day. This move was narrower than the S&P 500’s daily loss of 3.25%. Elsewhere, the Dow lost 2.42%, while the tech-heavy Nasdaq lost 0.49%.
Coming into today, shares of the short messaging service had gained 3.09% in the past month. In that same time, the Computer and Technology sector lost 5.7%, while the S&P 500 lost 5.62%.
Investors will be hoping for strength from Twitter as it approaches its next earnings release. The company is expected to report EPS of $0.14, down 30% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $1.33 billion, up 12.12% from the prior-year quarter.
TWTR’s full-year Zacks Consensus Estimates are calling for earnings of $1.66 per share and revenue of $5.89 billion. These results would represent year-over-year changes of +730% and +15.93%, respectively.
Any recent changes to analyst estimates for Twitter should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company’s business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Twitter is currently a Zacks Rank #3 (Hold).
Valuation is also important, so investors should note that Twitter has a Forward P/E ratio of 22.95 right now. For comparison, its industry has an average Forward P/E of 40.98, which means Twitter is trading at a discount to the group.
The Internet – Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 162, putting it in the bottom 36% 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.
You can find more information on all of these metrics, and much more, on Zacks.com.
Special Report: The Top 5 IPOs for Your Portfolio
Today, you have a chance to get in on the ground floor of one of the best investment opportunities of the year. As the world continues to benefit from an ever-evolving internet, a handful of innovative tech companies are on the brink of reaping immense rewards – and you can put yourself in a position to cash in. One is set to disrupt the online communication industry. Brilliantly designed for creating online communities, this stock is poised to explode when made public. With the strength of our economy and record amounts of cash flooding into IPOs, you don’t want to miss this opportunity.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.
Click to get this free report