Twitter (TWTR – Free Report) closed the most recent trading day at $28.47, moving +0.35% from the previous trading session. This move outpaced the S&P 500’s daily loss of 0.04%. At the same time, the Dow added 0.15%, and the tech-heavy Nasdaq lost 0.67%.
Coming into today, shares of the short messaging service had lost 7.85% in the past month. In that same time, the Computer and Technology sector lost 1.53%, while the S&P 500 gained 0.02%.
Investors will be hoping for strength from TWTR as it approaches its next earnings release, which is expected to be October 25, 2018. In that report, analysts expect TWTR to post earnings of $0.14 per share. This would mark year-over-year growth of 40%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $703.72 million, up 19.35% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $0.70 per share and revenue of $2.92 billion. These totals would mark changes of +59.09% and +19.63%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for TWTR. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
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. Over the past month, the Zacks Consensus EPS estimate remained stagnant. TWTR is holding a Zacks Rank of #2 (Buy) right now.
Looking at its valuation, TWTR is holding a Forward P/E ratio of 40.39. This represents a discount compared to its industry’s average Forward P/E of 65.53.
Also, we should mention that TWTR has a PEG ratio of 1.83. 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 4.26 as of yesterday’s close.
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.