Amazon (AMZN) closed at $235.01 in the latest trading session, marking a +1.86% move from the prior day. The stock outpaced the S&P 500's daily gain of 0.61%. Elsewhere, the Dow gained 0.3%, while the tech-heavy Nasdaq added 1.28%.
Shares of the online retailer have appreciated by 0.72% over the course of the past month, underperforming the Retail-Wholesale sector's gain of 2.32% and the S&P 500's gain of 2.08%.
The investment community will be closely monitoring the performance of Amazon in its forthcoming earnings report. The company is predicted to post an EPS of $1.54, indicating a 52.48% growth compared to the equivalent quarter last year. Simultaneously, our latest consensus estimate expects the revenue to be $187.13 billion, showing a 10.1% escalation compared to the year-ago quarter.
Investors should also take note of any recent adjustments to analyst estimates for Amazon. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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 past month, the Zacks Consensus EPS estimate has shifted 1.66% upward. At present, Amazon boasts a Zacks Rank of #2 (Buy).
Looking at valuation, Amazon is presently trading at a Forward P/E ratio of 36.41. Its industry sports an average Forward P/E of 21.93, so one might conclude that Amazon is trading at a premium comparatively.
We can additionally observe that AMZN currently boasts a PEG ratio of 1.29. 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. By the end of yesterday's trading, the Internet - Commerce industry had an average PEG ratio of 1.17.
The Internet - Commerce industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 75, which puts it in the top 30% of all 250+ industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.
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