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Amazon (AMZN) closed at $178.22 in the latest trading session, marking a +0.83% move from the prior day. This change outpaced the S&P 500’s 0.8% rise on the day. Meanwhile, the Dow Jones Industrial Average rose 0.23%, and the tech-heavy Nasdaq rose 1.14%.
Heading into today, shares of the online retailer had gained 10.97% over the past month, outpacing the Retail-Wholesale sector’s gain of 2.63% and the S&P 500’s gain of 5.2% in that time.
The investment community will be closely monitoring Amazon’s performance in its upcoming earnings report. On this day, Amazon is expected to report earnings of $0.81 per share, which would represent year-over-year growth of 161.29%. Meanwhile, our latest consensus estimate is projecting revenue of $142.39 billion, up 11.8% from the year-ago period.
For the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $4.06 per share and revenue of $641.11 billion. These totals represent changes of +40% and +11.54%, respectively, from last year.
Additionally, investors should note recent revisions to analyst estimates for Amazon. These revisions help illustrate the ever-changing nature of short-term business trends. As such, upward estimate revisions represent analyst positivity about the company’s business operations and ability to generate profits.
Our research suggests that these estimate changes have a direct relationship with future stock performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which considers these estimate changes and provides an actionable rating system.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), has a commendable, independently-audited track record of outperformance, with #1 stocks gaining +25% since 1988. Contributes to average annual return. Over the past 30 days, our consensus EPS estimate has moved 10.81% higher. Amazon currently has a Zacks Rank #1 (Strong Buy).
From a valuation perspective, Amazon currently trades at a forward P/E ratio of 43.5x. This represents a premium compared to its industry’s average Forward P/E of 17.58.
We also note that AMZN currently has a PEG ratio of 1.55. The PEG ratio is similar to the widely used P/E ratio, but this metric also takes into account a company’s expected earnings growth rate. As of yesterday’s close, the average PEG ratio for the Internet Commerce industry was 0.57.
The internet commerce industry is part of the retail wholesale sector. This group has a Zacks Industry Rank of 145, which puts it in the bottom 43% 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% of industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and more, on Zacks.com.
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Amazon.com, Inc. (AMZN): Free Stock Analysis Report
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