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Amazon (AMZN) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research

Amazon (AMZN) closed the most recent trading day at $1,789.21, moving -0.21% from the previous trading session. This move lagged the S&P 500's daily loss of 0.02%. Meanwhile, the Dow lost 0.13%, and the Nasdaq, a tech-heavy index, added 0.08%.

Heading into today, shares of the online retailer had gained 1.08% over the past month, lagging the Retail-Wholesale sector's gain of 4.05% and the S&P 500's gain of 3.81% in that time.

AMZN will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $3.98, down 34.11% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $85.98 billion, up 18.79% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $20.51 per share and revenue of $279.12 billion. These totals would mark changes of +1.84% and +19.85%, respectively, from last year.

Any recent changes to analyst estimates for AMZN should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

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 ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.03% lower. AMZN currently has a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that AMZN has a Forward P/E ratio of 87.43 right now. This represents a premium compared to its industry's average Forward P/E of 22.31.

Meanwhile, AMZN's PEG ratio is currently 3.18. 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. Internet - Commerce stocks are, on average, holding a PEG ratio of 1.42 based on yesterday's closing prices.

The Internet - Commerce industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 205, putting it in the bottom 20% 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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