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Why Leidos (LDOS) Dipped More Than Broader Market Today

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Leidos (LDOS - Free Report) closed the most recent trading day at $183.35, moving -1.15% from the previous trading session. This change lagged the S&P 500's 0.14% loss on the day. On the other hand, the Dow registered a loss of 0.2%, and the technology-centric Nasdaq decreased by 0.24%.

The stock of security and engineering company has fallen by 1.56% in the past month, lagging the Computer and Technology sector's gain of 0.2% and the S&P 500's gain of 0.94%.

The investment community will be paying close attention to the earnings performance of Leidos in its upcoming release. The company is forecasted to report an EPS of $2.52, showcasing a 6.33% upward movement from the corresponding quarter of the prior year. Meanwhile, our latest consensus estimate is calling for revenue of $4.25 billion, down 2.58% from the prior-year quarter.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $11.72 per share and revenue of $17.22 billion, indicating changes of +14.79% and +3.35%, respectively, compared to the previous year.

Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Leidos. Such recent modifications usually signify the changing landscape of near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed an unchanged state. Leidos is currently sporting a Zacks Rank of #2 (Buy).

Valuation is also important, so investors should note that Leidos has a Forward P/E ratio of 15.83 right now. This represents a discount compared to its industry average Forward P/E of 17.12.

Investors should also note that LDOS has a PEG ratio of 1.36 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. As of the close of trade yesterday, the Computers - IT Services industry held an average PEG ratio of 1.82.

The Computers - IT Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 87, putting it in the top 36% of all 250+ industries.

The Zacks Industry Rank is ordered 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.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.


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