U.S. Markets closed

Avid Technology (AVID) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research

Avid Technology (AVID) closed at $8.61 in the latest trading session, marking a -1.49% move from the prior day. This move lagged the S&P 500's daily gain of 0.31%. Meanwhile, the Dow gained 0.44%, and the Nasdaq, a tech-heavy index, added 0.26%.

Coming into today, shares of the audio and video technology company had gained 1.86% in the past month. In that same time, the Computer and Technology sector gained 4.64%, while the S&P 500 gained 1.18%.

AVID will be looking to display strength as it nears its next earnings release. In that report, analysts expect AVID to post earnings of $0.32 per share. This would mark year-over-year growth of 10.34%. Our most recent consensus estimate is calling for quarterly revenue of $113.51 million, up 0.74% from the year-ago period.

Investors might also notice recent changes to analyst estimates for AVID. 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. 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.

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. AVID is holding a Zacks Rank of #3 (Hold) right now.

Valuation is also important, so investors should note that AVID has a Forward P/E ratio of 10.86 right now. This valuation marks a discount compared to its industry's average Forward P/E of 33.25.

Meanwhile, AVID's PEG ratio is currently 1.09. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Computer - Software stocks are, on average, holding a PEG ratio of 2.26 based on yesterday's closing prices.

The Computer - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 53, putting it in the top 21% 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 AVID in the coming trading sessions, be sure to utilize Zacks.com.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Avid Technology, Inc. (AVID) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research