Snap (SNAP) closed at $10.45 in the latest trading session, marking a +1.75% move from the prior day. The stock outperformed the S&P 500, which registered a daily loss of 0.03%. Meanwhile, the Dow lost 0.61%, and the Nasdaq, a tech-heavy index, added 0.56%.
Shares of the company behind Snapchat have depreciated by 2.75% over the course of the past month, underperforming the Computer and Technology sector’s gain of 1.65% and the S&P 500’s gain of 1.39%.
The investment community will be closely monitoring the performance of Snap in its forthcoming earnings report. The company is scheduled to release its earnings on October 29, 2024. The company’s earnings per share (EPS) are projected to be $0.05, reflecting a 150% increase from the same quarter last year. Our most recent consensus estimate is calling for quarterly revenue of $1.35 billion, up 13.93% from the year-ago period.
For the full year, the Zacks Consensus Estimates are projecting earnings of $0.21 per share and revenue of $5.34 billion, which would represent changes of +133.33% and +16.03%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for Snap. 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.
Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. 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, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged. Snap is currently a Zacks Rank #4 (Sell).
Valuation is also important, so investors should note that Snap has a Forward P/E ratio of 48.33 right now. For comparison, its industry has an average Forward P/E of 32.9, which means Snap is trading at a premium to the group.
The Internet – Software industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 70, positioning it in the top 28% of all 250+ industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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