Back to top

Image: Bigstock

Amazon (AMZN) Outpaces Stock Market Gains: What You Should Know

Read MoreHide Full Article

In the latest trading session, Amazon (AMZN - Free Report) closed at $3,019.79, marking a +0.66% move from the previous day. The stock outpaced the S&P 500's daily gain of 0.3%. Meanwhile, the Dow gained 0.2%, and the Nasdaq, a tech-heavy index, added 0.37%.

Heading into today, shares of the online retailer had lost 12.84% over the past month, lagging the Retail-Wholesale sector's loss of 3.71% and the S&P 500's loss of 5.02% in that time.

Wall Street will be looking for positivity from AMZN as it approaches its next earnings report date. On that day, AMZN is projected to report earnings of $7.50 per share, which would represent year-over-year growth of 77.3%. Our most recent consensus estimate is calling for quarterly revenue of $92.78 billion, up 32.58% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $31.92 per share and revenue of $369.75 billion. These totals would mark changes of +38.72% and +31.81%, respectively, from last year.

Any recent changes to analyst estimates for AMZN should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an 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. Over the past month, the Zacks Consensus EPS estimate has moved 0.25% lower. AMZN currently has a Zacks Rank of #3 (Hold).

Digging into valuation, AMZN currently has a Forward P/E ratio of 93.99. This valuation marks a premium compared to its industry's average Forward P/E of 48.58.

Also, we should mention that AMZN has a PEG ratio of 3.12. 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. The Internet - Commerce was holding an average PEG ratio of 3.12 at yesterday's closing price.

The Internet - Commerce industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 90, putting it in the top 36% 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.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Amazon.com, Inc. (AMZN) - free report >>

Published in