Back to top

Image: Bigstock

Flex (FLEX) Stock Sinks As Market Gains: What You Should Know

Read MoreHide Full Article

Flex (FLEX - Free Report) closed the most recent trading day at $14.25, moving -1.52% from the previous trading session. This change lagged the S&P 500's 1.06% gain on the day. Meanwhile, the Dow gained 1.05%, and the Nasdaq, a tech-heavy index, added 0.4%.

Heading into today, shares of the electronics designer and manufacturer had lost 16.26% over the past month, lagging the Computer and Technology sector's loss of 8.63% and the S&P 500's loss of 8.3% in that time.

Flex will be looking to display strength as it nears its next earnings release. On that day, Flex is projected to report earnings of $0.44 per share, which would represent a year-over-year decline of 4.35%. Our most recent consensus estimate is calling for quarterly revenue of $6.8 billion, up 7.15% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2.16 per share and revenue of $28.16 billion. These totals would mark changes of +10.2% and +8.14%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for Flex. Recent revisions tend to reflect the latest near-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. 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. The Zacks Consensus EPS estimate remained stagnant within the past month. Flex is currently sporting a Zacks Rank of #3 (Hold).

In terms of valuation, Flex is currently trading at a Forward P/E ratio of 6.7. Its industry sports an average Forward P/E of 15.29, so we one might conclude that Flex is trading at a discount comparatively.

We can also see that FLEX currently has a PEG ratio of 0.45. 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 Electronics - Miscellaneous Products was holding an average PEG ratio of 1.73 at yesterday's closing price.

The Electronics - Miscellaneous Products industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 174, putting it in the bottom 32% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. 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

In-Depth Zacks Research for the Tickers Above

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

Flex Ltd. (FLEX) - free report >>

Published in