In the latest trading session, Amazon (AMZN) closed at $3,138.29, marking a -1.83% move from the previous day. This change lagged the S&P 500’s daily gain of 0.17%. Meanwhile, the Dow gained 0.6%, and the Nasdaq, a tech-heavy index, lost 0.81%.
Coming into today, shares of the online retailer had gained 17.8% in the past month. In that same time, the Retail-Wholesale sector gained 11.13%, while the S&P 500 gained 5.15%.
AMZN will be looking to display strength as it nears its next earnings release, which is expected to be July 30, 2020. On that day, AMZN is projected to report earnings of $1.75 per share, which would represent a year-over-year decline of 66.48%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $81.27 billion, up 28.18% from the year-ago period.
AMZN’s full-year Zacks Consensus Estimates are calling for earnings of $20.21 per share and revenue of $351.48 billion. These results would represent year-over-year changes of -12.17% and +25.29%, respectively.
Investors might also notice recent changes to analyst estimates for AMZN. These recent revisions tend to reflect the evolving nature of short-term business trends. 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.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 5.28% higher. AMZN currently has a Zacks Rank of #3 (Hold).
Digging into valuation, AMZN currently has a Forward P/E ratio of 158.18. This valuation marks a premium compared to its industry’s average Forward P/E of 48.18.
Investors should also note that AMZN has a PEG ratio of 5.86 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company’s expected earnings growth rate into account. AMZN’s industry had an average PEG ratio of 2.59 as of yesterday’s close.
The Internet – Commerce industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 110, which puts it in the top 44% 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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