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Why Strategy (MSTR) Dipped More Than Broader Market Today

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In the latest close session, Strategy (MSTR - Free Report) was down 2.35% at $151.95. The stock's change was less than the S&P 500's daily loss of 0.74%. Elsewhere, the Dow lost 0.63%, while the tech-heavy Nasdaq lost 0.76%.

Shares of the business software company witnessed a loss of 14.18% over the previous month, trailing the performance of the Finance sector with its gain of 2.1%, and the S&P 500's gain of 0.79%.

The upcoming earnings release of Strategy will be of great interest to investors. The company's earnings per share (EPS) are projected to be $46.02, reflecting a 1538.13% increase from the same quarter last year. Meanwhile, our latest consensus estimate is calling for revenue of $119.6 million, down 0.91% from the prior-year quarter.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $78.04 per share and a revenue of $473.1 million, representing changes of +1261.31% and +2.08%, respectively, from the prior year.

It's also important for investors to be aware of any recent modifications to analyst estimates for Strategy. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable 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. Strategy presently features a Zacks Rank of #3 (Hold).

In terms of valuation, Strategy is currently trading at a Forward P/E ratio of 1.99. Its industry sports an average Forward P/E of 12.09, so one might conclude that Strategy is trading at a discount comparatively.

The Financial - Miscellaneous Services industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 96, which puts it in the top 39% 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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