Twitter (TWTR) closed at $31.37 in the latest trading session, marking a -1.13% move from the prior day. This change lagged the S&P 500’s daily gain of 1.1%. Meanwhile, the Dow gained 1.18%, and the Nasdaq, a tech-heavy index, added 1.09%.
Wall Street will be looking for positivity from TWTR as it approaches its next earnings report date. The company is expected to report EPS of -$0.03, down 113.64% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $690.53 million, down 17.93% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $0.35 per share and revenue of $3.23 billion. These totals would mark changes of -85.23% and -6.66%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for TWTR. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company’s 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 ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. TWTR is currently a Zacks Rank #3 (Hold).
Digging into valuation, TWTR currently has a Forward P/E ratio of 91.53. Its industry sports an average Forward P/E of 54.18, so we one might conclude that TWTR is trading at a premium comparatively.
It is also worth noting that TWTR currently has a PEG ratio of 2.37. 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. TWTR’s industry had an average PEG ratio of 3.56 as of yesterday’s close.
The Internet – Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 48, putting it in the top 19% 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.
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