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Gladstone Commercial (GOOD) Exceeds Market Returns: Some Facts to Consider

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In the latest close session, Gladstone Commercial (GOOD - Free Report) was up +1.32% at $14.57. The stock outperformed the S&P 500, which registered a daily gain of 0.96%. On the other hand, the Dow registered a gain of 0.89%, and the technology-centric Nasdaq increased by 0.94%.

Prior to today's trading, shares of the real estate investment trust had gained 3.83% outpaced the Finance sector's loss of 1.18% and the S&P 500's gain of 0.5%.

The investment community will be paying close attention to the earnings performance of Gladstone Commercial in its upcoming release. The company's earnings per share (EPS) are projected to be $0.35, reflecting a 2.78% decrease from the same quarter last year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $37.86 million, up 2.16% from the year-ago period.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $1.41 per share and revenue of $152.02 million, indicating changes of -0.7% and +1.76%, respectively, compared to the previous year.

Any recent changes to analyst estimates for Gladstone Commercial should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-term stock moves. 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, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged. Gladstone Commercial is currently sporting a Zacks Rank of #3 (Hold).

Digging into valuation, Gladstone Commercial currently has a Forward P/E ratio of 10.18. This represents a discount compared to its industry average Forward P/E of 11.75.

One should further note that GOOD currently holds a PEG ratio of 1.7. 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. As the market closed yesterday, the REIT and Equity Trust - Other industry was having an average PEG ratio of 2.46.

The REIT and Equity Trust - Other industry is part of the Finance sector. This industry, currently bearing a Zacks Industry Rank of 99, finds itself in the top 41% echelons 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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