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Cadence Design Systems, Inc. (CDNS) - free report >>
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Bear of the Day: MicroStrategy (MSTR)
Tech stocks continue to come under pressure on Wall Street. One day, we get a great Facebook report that gives us a big rally. The next, Amazon disappoints and it all gets erased. The risk-off behavior has spilled over from tech stocks to cryptocurrency. That certainly does not bode well for you when you are a tech stock heavily involved in cryptocurrency. Today’s Bear of the Day is one such stock, MicroStrategy (MSTR - Free Report) .
MicroStrategy Incorporated provides enterprise analytics software and services worldwide. It offers MicroStrategy, an enterprise platform, which provides a modern analytics experience by delivering insights across multiple devices to users via hyperintelligence products, visualization and reporting capabilities, mobility features, and custom applications developed on the platform; analysts and data scientists with seamless access to trusted, governed data directly within their tools; and APIs and gateways, multiple deployment options, enterprise semantic graph, scalability, and security.
MicroStrategy became famous after becoming one of the first publicly traded companies to load its balance sheet with bitcoin. Last quarter alone, the company bought 4,167 bitcoin, giving it a whopping 129,218 in reserves.
Image Source: Zacks Investment Research
Image Source: Zacks Investment Research
MicroStrategy is a Zacks Rank #5 (Strong Sell). The reason for the unfavorable rank is recent earnings estimates coming from analysts on Wall Street. Over the last 60 days, the current year Zacks Consensus Estimate is off from $7.73 to $6.64 while next year’s number is off from $6.76 to $5.86. That means analysts are expecting to see an 11.75% contraction in earnings next year. That’s slated to happen on revenue growth of 5.4%.
MicroStrategy is in the Computer – Software industry which ranks in the Bottom 39% of our Zacks Industry Rank. Investors looking for other stocks within the same industry have a few options which are in the good graces of our Zacks Rank. These include Zacks Rank #1 (Strong Buy) stocks Cadence Design Systems (CDNS - Free Report) and Manhattan Associates (MANH - Free Report) .