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Square (SQ) Gains As Market Dips: What You Should Know

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Square (SQ - Free Report) closed at $239.74 in the latest trading session, marking a +1.57% move from the prior day. The stock outpaced the S&P 500's daily loss of 1.19%.

Prior to today's trading, shares of the mobile payments services provider had lost 12.01% over the past month. This has lagged the Computer and Technology sector's loss of 5.5% and the S&P 500's loss of 3.16% in that time.

Investors will be hoping for strength from SQ as it approaches its next earnings release. On that day, SQ is projected to report earnings of $0.38 per share, which would represent year-over-year growth of 11.76%. Meanwhile, our latest consensus estimate is calling for revenue of $4.58 billion, up 50.83% from the prior-year quarter.

SQ's full-year Zacks Consensus Estimates are calling for earnings of $1.87 per share and revenue of $18.89 billion. These results would represent year-over-year changes of +122.62% and +98.89%, respectively.

Investors should also note any recent changes to analyst estimates for SQ. 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. The Zacks Consensus EPS estimate remained stagnant within the past month. SQ is currently sporting a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that SQ has a Forward P/E ratio of 126.39 right now. This valuation marks a premium compared to its industry's average Forward P/E of 54.94.

Meanwhile, SQ's PEG ratio is currently 4.03. 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. Internet - Software stocks are, on average, holding a PEG ratio of 4.03 based on yesterday's closing prices.

The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 207, which puts it in the bottom 19% 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 SQ in the coming trading sessions, be sure to utilize Zacks.com.


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