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

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Amazon (AMZN - Free Report) closed the most recent trading day at $3,165.89, moving +1.44% from the previous trading session. The stock outpaced the S&P 500's daily gain of 0.23%. Meanwhile, the Dow lost 0.03%, and the Nasdaq, a tech-heavy index, added 0.43%.

Coming into today, shares of the online retailer had lost 1.4% in the past month. In that same time, the Retail-Wholesale sector lost 0.21%, while the S&P 500 gained 3.86%.

AMZN will be looking to display strength as it nears its next earnings release. In that report, analysts expect AMZN to post earnings of $7.01 per share. This would mark year-over-year growth of 8.35%. Our most recent consensus estimate is calling for quarterly revenue of $120.23 billion, up 37.5% from the year-ago period.

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 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. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

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 has moved 0.21% higher. AMZN is currently sporting a Zacks Rank of #3 (Hold).

Looking at its valuation, AMZN is holding a Forward P/E ratio of 69.54. Its industry sports an average Forward P/E of 50.53, so we one might conclude that AMZN is trading at a premium comparatively.

Investors should also note that AMZN has a PEG ratio of 2.38 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. The Internet - Commerce was holding an average PEG ratio of 2.51 at yesterday's closing price.

The Internet - Commerce industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 229, which puts it in the bottom 11% of all 250+ industries.

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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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