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Zynga (ZNGA) Dips More Than Broader Markets: What You Should Know

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In the latest trading session, Zynga (ZNGA - Free Report) closed at $6, marking a -1.48% move from the previous day. This change lagged the S&P 500's daily loss of 0.41%. At the same time, the Dow lost 0.01%, and the tech-heavy Nasdaq gained 0.13%.

Prior to today's trading, shares of the maker of "FarmVille" and other online games had lost 3.94% over the past month. This has lagged the Consumer Discretionary sector's loss of 2.75% and the S&P 500's gain of 2.36% in that time.

Wall Street will be looking for positivity from Zynga as it approaches its next earnings report date. In that report, analysts expect Zynga to post earnings of $0.08 per share. This would mark year-over-year growth of 100%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $721.09 million, up 3.17% from the year-ago period.

It is also important to note the recent changes to analyst estimates for Zynga. 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.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, 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 remained stagnant. Zynga is holding a Zacks Rank of #3 (Hold) right now.

In terms of valuation, Zynga is currently trading at a Forward P/E ratio of 15.04. Its industry sports an average Forward P/E of 17.3, so we one might conclude that Zynga is trading at a discount comparatively.

The Gaming industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 178, putting it in the bottom 31% 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.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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