Facebook (FB) closed the most recent trading day at $354.70, moving +0.09% from the previous trading session. This move lagged the S&P 500’s daily gain of 0.75%.
Coming into today, shares of the social media company had gained 7.37% in the past month. In that same time, the Computer and Technology sector gained 7.17%, while the S&P 500 gained 3.52%.
Wall Street will be looking for positivity from FB as it approaches its next earnings report date. This is expected to be July 28, 2021. On that day, FB is projected to report earnings of $3.03 per share, which would represent year-over-year growth of 68.33%. Our most recent consensus estimate is calling for quarterly revenue of $27.89 billion, up 49.25% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $13.18 per share and revenue of $116.21 billion, which would represent changes of +30.62% and +35.18%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for FB. 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. Within the past 30 days, our consensus EPS projection remained stagnant. FB is currently a Zacks Rank #4 (Sell).
Valuation is also important, so investors should note that FB has a Forward P/E ratio of 26.91 right now. For comparison, its industry has an average Forward P/E of 30.92, which means FB is trading at a discount to the group.
Meanwhile, FB’s PEG ratio is currently 1.34. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. The Internet – Services was holding an average PEG ratio of 1.98 at yesterday’s closing price.
The Internet – Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 226, putting it in the bottom 12% 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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