For Immediate Release
Chicago, IL – August 10, 2017 – Zacks Equity Research highlights ZAGG Inc. (NASDAQ:ZAGG – Free Report) as the Bull of the Day F5 Networks (NASDAQ:FFIV – Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Snap Inc. (NYSE:SNAP – Free Report).
Here is a synopsis of all five stocks:
Bull of the Day:
ZAGG Inc.(NASDAQ:(ZAGG - Free Report) – Free Report) is a Zacks Rank #1 (Strong Buy) and carries a growth style score of “A” which automatically puts it on my radar screen. Following the recent beat the stock rallied over $10 and now that it is the Bull of the Day, it is on your radar screen!
I run Stocks Under $10 for Zacks and I used to have a position in this stock. It was about two years ago that I added the stock at $7.92 on July 28, 2015. The position was sold on 12/29/15 for $11.40 -- the subscribers that followed that trade took home just short of 44%.
ZAGG Inc, makes mobile tech accessories for smartphones and tablets. The company operates through ZAGG and mophie segments. It offers screen protection products; battery cases and power management products for tablets, smartphones, MP3 players, cameras, and other electronic mobile devices; device specific keyboards and device agnostic keyboards; earbuds, headphones, Bluetooth speakers, and cables under the ZAGG, InvisibleShield, IFROGZ, and mophie brands. ZAGG Inc is headquartered in Midvale, Utah.
The company reported a solid quarter at the start of the month. The company beat the top and bottom line expectations and the stock moved higher by 4.7% as a result. Revenues were $115M, $5M ahead of the expectation while EPS of $0.12 were $0.02 better than expected.
Estimates Move Higher
Back in February of this year, the Zacks Consensus Estimate was $0.53. A few beats later the number has shot higher to $0.82. That is the 2017 number and most investors are looking ahead to the 2018 number.
The 2018 number started out at $1.00 in May, that kicked higher to $1.10 in July. In early August following the most recent beat, the number has moved higher to $1.13.
This is the primary reason the stock is a Zacks Rank #1 (Strong Buy).
The Bear of the Day is an article that shows why a Zacks Rank #5 (Strong Sell) has become just that, a Zacks Rank #5 (Strong Sell). The Zacks Rank looks at earnings estimate revisions and the stocks that see negative revisions slide lower on the scale.
F5 Networks (NASDAQ:(FFIV - Free Report) – Free Report) has missed the Zacks Consensus Estimate in each of the last three reports. The two most recent reports have also seen the company report revenues that were below expectations.
F5 Networks Inc. is a leading provider of integrated Internet traffic and content management solutions designed to improve the availability and performance of mission-critical Internet-based servers and applications. The company's products monitor and manage local and geographically dispersed servers and intelligently direct traffic to the server best able to handle a user's request. The products are designed to help prevent system failure and provide timely responses to user requests and data flow.
The biggest factor that influences the Zacks Rank is the movement of earnings estimates. When estimate revisions are positive, the stock tends to have a higher Zacks Rank. That is not the case for FFIV.
The Zacks Consensus Estimate for FFIV was $6.47 in March of this year, but it slid to $6.35 in April and is now down to $6.28.
The 2018 estimate has also fallen. The Zacks Consensus Estimate for 2018 was $7.41 in March and has dipped down to $6.87. That is a big move lower.
3 Reasons to Be Cautious About SNAP’s Upcoming Earnings Report
Snap Inc. (NYSE:SNAP – Free Report) provides technology and social media services. The company’s principal product, Snapchat, is a camera application that helps people to communicate through short videos and images. Furthermore, the struggling company will be releasing its quarterly earnings report after the market closes on August 10.
Snap Inc. currently sports a Zacks Rank #4 (Sell) and defeated its earnings estimates last quarter by meager 0.86%. Additionally, the company operates in the Internet-Software industry, which sits in the bottom 42% on the Zacks Industry Rank.
Regardless of Snap’s Earnings ESP of 3.45%, the company holds an inadequate Zacks Rank and is expected to release lackluster earnings of -$0.29 per share, which provides a murky financial outlook for the firm.
If that’s not enough, here are 3 additional reasons to be cautious on Snap as we near its earnings report date:
1. Signs Of An Overvalued Investment
Snap currently holds an “F” grade for Value in our Style Score system, which means that we view the company as overvalued. For example, Snap features an Earnings Yield of -20.24% and price/sales ratio of 9.06, both of which fall short of the industry averages of -2.12% and 3.62, respectively. Furthermore, Snap Inc. holds an underwhelming P/E ratio of -4.80 and lackluster PEG ratio of -0.09. These metrics show that Snap Inc. might not be the smartest security to buy for an investor seeking impressive value on the market.
2. Negative Earnings Estimate Revisions
Earnings estimate revisions are the main ingredient for determining a company’s Zacks Rank. Snap possesses a murky future pertaining to earnings. For example, as of 30 days ago, Snap Inc.’s current quarter earnings estimates were revised to -$0.29 per share, which signifies a downward trend of -7.41%. Also within the past 30 days, Snap’s full-year EPS estimates fell from -$2.66 to -$2.71 per share, which constitutes a decrease of -1.88%. Overall, nine analysts covered Snap Inc. for this quarter’s earnings release, and two negative revisions have been made.
3. Poor Share Price Performance
Snap’s stock has been retreating since its initial public offering back in early March, without showing many signs of hope. Currently, the stock is trading at around $13.51, which is not too far off its all-time low of $11.91. Snap’s all-time high of $29.44 was reached right after its IPO, a period in which a stock’s price tends to rise considerably.
In essence, Snap’s share price has fallen by 54.11% since this high was recorded, including a drop of a whopping 15.84% within the past four weeks. Those who have held on the stock since its initial public offering could continue to pay the price this earnings season.
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About the Bull and Bear of the Day
Every day, the analysts at Zacks Equity Research select two stocks that are likely to outperform (Bull) or underperform (Bear) the markets over the next 3-6 months.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
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