Twitter (TWTR) closed at $35.81 in the latest trading session, marking a +1.5% move from the prior day. This move outpaced the S&P 500’s daily gain of 0.29%. Meanwhile, the Dow lost 0.24%, and the Nasdaq, a tech-heavy index, added 0.28%.
Prior to today’s trading, shares of the short messaging service had gained 3.67% over the past month. This has lagged the Computer and Technology sector’s gain of 4.98% and outpaced the S&P 500’s gain of 2.96% in that time.
Wall Street will be looking for positivity from TWTR as it approaches its next earnings report date. This is expected to be July 23, 2020. 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 $700.62 million, down 16.73% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $0.35 per share and revenue of $3.27 billion, which would represent changes of -85.23% and -5.35%, respectively, from the prior year.
Investors might also notice 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.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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. Within the past 30 days, our consensus EPS projection remained stagnant. TWTR currently has a Zacks Rank of #3 (Hold).
In terms of valuation, TWTR is currently trading at a Forward P/E ratio of 100.48. This valuation marks a premium compared to its industry’s average Forward P/E of 69.19.
Also, we should mention that TWTR has a PEG ratio of 2.6. 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. Internet – Software stocks are, on average, holding a PEG ratio of 3.67 based on yesterday’s closing prices.
The Internet – Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 75, putting it in the top 30% 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% 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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