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Twitter (TWTR) Dips More Than Broader Markets: What You Should Know

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Twitter (TWTR - Free Report) closed at $60.23 in the latest trading session, marking a -0.99% move from the prior day. This change lagged the S&P 500's 0.2% loss on the day.

Coming into today, shares of the short messaging service had gained 15.65% in the past month. In that same time, the Computer and Technology sector gained 7.19%, while the S&P 500 gained 2.11%.

TWTR will be looking to display strength as it nears its next earnings release. On that day, TWTR is projected to report earnings of $0.07 per share, which would represent year-over-year growth of 105.04%. Meanwhile, our latest consensus estimate is calling for revenue of $1.06 billion, up 54.5% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $0.77 per share and revenue of $4.79 billion, which would represent changes of +188.51% and +28.87%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for TWTR. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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 1.76% lower. TWTR is currently sporting a Zacks Rank of #4 (Sell).

Investors should also note TWTR's current valuation metrics, including its Forward P/E ratio of 78.81. Its industry sports an average Forward P/E of 72.05, so we one might conclude that TWTR is trading at a premium comparatively.

The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 212, putting it in the bottom 17% 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.

To follow TWTR in the coming trading sessions, be sure to utilize Zacks.com.


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