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Amazon (AMZN) Outpaces Stock Market Gains: What You Should Know

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In the latest trading session, Amazon (AMZN) closed at $124.63, marking a +1.52% move from the previous day. This move outpaced the S&P 500's daily gain of 0.99%. At the same time, the Dow added 0.51%, and the tech-heavy Nasdaq lost 0.31%.

Coming into today, shares of the online retailer had gained 12.69% in the past month. In that same time, the Retail-Wholesale sector gained 10.59%, while the S&P 500 gained 7.91%.

Investors will be hoping for strength from Amazon as it approaches its next earnings release, which is expected to be July 28, 2022. The company is expected to report EPS of $0.15, down 80.26% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $119.79 billion, up 5.94% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $0.53 per share and revenue of $522.91 billion, which would represent changes of -83.64% and +11.3%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for Amazon. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.12% higher within the past month. Amazon is holding a Zacks Rank of #3 (Hold) right now.

Valuation is also important, so investors should note that Amazon has a Forward P/E ratio of 231.79 right now. This represents a premium compared to its industry's average Forward P/E of 24.31.

We can also see that AMZN currently has a PEG ratio of 8.68. 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 - Commerce industry currently had an average PEG ratio of 1.22 as of yesterday's close.

The Internet - Commerce industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 132, putting it in the bottom 48% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our 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.

To follow AMZN in the coming trading sessions, be sure to utilize Zacks.com.


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