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Digital Turbine (APPS) Gains But Lags Market: What You Should Know

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Zacks Equity Research
·3 min read
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Digital Turbine (APPS) closed the most recent trading day at $86.69, moving +0.18% from the previous trading session. This change lagged the S&P 500's 0.77% gain on the day.

Coming into today, shares of the mobile software company had gained 7.71% in the past month. In that same time, the Computer and Technology sector gained 10.54%, while the S&P 500 gained 7.34%.

Wall Street will be looking for positivity from APPS as it approaches its next earnings report date. In that report, analysts expect APPS to post earnings of $0.19 per share. This would mark year-over-year growth of 280%. Meanwhile, our latest consensus estimate is calling for revenue of $83.76 million, up 112.86% from the prior-year quarter.

It is also important to note the recent changes to analyst estimates for APPS. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about 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, 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 12.31% lower within the past month. APPS is currently sporting a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that APPS has a Forward P/E ratio of 81.74 right now. This valuation marks a premium compared to its industry's average Forward P/E of 67.57.

It is also worth noting that APPS currently has a PEG ratio of 1.63. 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. APPS's industry had an average PEG ratio of 3.68 as of yesterday's close.

The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 208, which puts it in the bottom 19% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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