Snap (SNAP) ended the most recent trading day at $15.87, up +1.73% from the previous day’s close. This stock price change outpaced the S&P 500’s daily gain of 0.85%, while the Dow fell 0.09% and the tech-heavy Nasdaq rose 1.53%.
Heading into today, shares of the Snapchat company had lost 0.13% over the past month. During that same time, the Computer and Technology sector has lost 3.6%, while the S&P 500 has gained 3.11%.
Investors will be eager to see how Snap performs in its upcoming earnings disclosure. The company is expected to report EPS of $0.02, which would represent a 200% increase over the same period last year, while our current consensus estimate is calling for revenue of $1.25 billion, which would represent a 16.75% increase over the same period last year.
Looking at the full fiscal year, our Zacks Consensus Estimates are projecting earnings of $0.23 per share and revenue of $5.34 billion, which would represent changes of +155.56% and +15.97%, respectively, from the prior year.
Investors should also pay attention to the latest changes to analyst estimates for Snap. Such recent changes usually signal a shift in near-term business trend conditions. With this in mind, positive estimate revisions can be viewed as a sign of optimism for the company’s business outlook.
Empirical research shows that these estimate revisions are directly correlated with future stock price movements, and to take advantage of this, we have developed the Zacks Rank, a proprietary model which takes these estimate revisions into account and provides an actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell), and 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 has moved 4.74% higher. Snap is currently sporting a Zacks Rank #2 (Buy).
In terms of valuation, Snap’s stock is currently trading at a Forward P/E ratio of 66.99, which indicates that it is overvalued compared to its industry peers’ Forward P/E ratio of 30.18.
The Internet – Software industry is part of the Computer and Technology sector. Currently, this industry is ranked #72 in the Zacks Industry Rank, putting it in the top 29% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by determining the average Zacks Rank of the individual stocks that make up the groups, and our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to stay up to date on all the indicators moving the stock during the next trading session by utilizing Zacks.com.
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