Back to top

Image: Bigstock

Snap (SNAP) Registers a Bigger Fall Than the Market: Important Facts to Note

Read MoreHide Full Article

Snap (SNAP - Free Report) closed the most recent trading day at $8.62, moving -1.93% from the previous trading session. This change lagged the S&P 500's 0.34% loss on the day. Elsewhere, the Dow lost 0.94%, while the tech-heavy Nasdaq added 0.16%.

Coming into today, shares of the company behind Snapchat had gained 10.98% in the past month. In that same time, the Computer and Technology sector lost 1%, while the S&P 500 gained 1.19%.

The investment community will be closely monitoring the performance of Snap in its forthcoming earnings report. The company's earnings per share (EPS) are projected to be $0.15, reflecting a 6.25% decrease from the same quarter last year. At the same time, our most recent consensus estimate is projecting a revenue of $1.7 billion, reflecting a 9.12% rise from the equivalent quarter last year.

SNAP's full-year Zacks Consensus Estimates are calling for earnings of $0.32 per share and revenue of $5.91 billion. These results would represent year-over-year changes of +10.34% and 0%, respectively.

Investors might also notice recent changes to analyst estimates for Snap. 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.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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. At present, Snap boasts a Zacks Rank of #2 (Buy).

Digging into valuation, Snap currently has a Forward P/E ratio of 18.03. This indicates a discount in contrast to its industry's Forward P/E of 25.

Investors should also note that SNAP has a PEG ratio of 0.83 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The average PEG ratio for the Internet - Software industry stood at 1.58 at the close of the market yesterday.

The Internet - Software industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 57, finds itself in the top 24% echelons of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.


See More Zacks Research for These Tickers


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


Snap Inc. (SNAP) - free report >>

Published in