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Twitter (TWTR) Outpaces Stock Market Gains: What You Should Know

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Twitter (TWTR - Free Report) closed at $34.38 in the latest trading session, marking a +1.87% move from the prior day. This change outpaced the S&P 500's 0.22% gain on the day. Elsewhere, the Dow gained 0.15%, while the tech-heavy Nasdaq added 0.6%.

Prior to today's trading, shares of the short messaging service had gained 8.77% over the past month. This has outpaced the Computer and Technology sector's gain of 4.32% and the S&P 500's gain of 2.39% in that time.

TWTR will be looking to display strength as it nears its next earnings release, which is expected to be April 23, 2019. The company is expected to report EPS of $0.14, down 12.5% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $773.26 million, up 16.3% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $0.84 per share and revenue of $3.49 billion. These totals would mark changes of -2.33% and +14.68%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for TWTR. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. TWTR is holding a Zacks Rank of #3 (Hold) right now.

Valuation is also important, so investors should note that TWTR has a Forward P/E ratio of 40.42 right now. This represents a discount compared to its industry's average Forward P/E of 56.49.

Also, we should mention that TWTR has a PEG ratio of 1.67. 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 Internet - Software industry currently had an average PEG ratio of 3.14 as of yesterday's close.

The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 55, which puts it in the top 22% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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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