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Digital Turbine (APPS) Outpaces Stock Market Gains: What You Should Know

·3 min read

In the latest trading session, Digital Turbine (APPS) closed at $17.76, marking a +1.31% move from the previous day. The stock outpaced the S&P 500's daily gain of 0.66%. Elsewhere, the Dow gained 0.61%, while the tech-heavy Nasdaq lost 0.02%.

Coming into today, shares of the mobile software company had lost 24.86% in the past month. In that same time, the Computer and Technology sector lost 8.24%, while the S&P 500 lost 3.79%.

Investors will be hoping for strength from Digital Turbine as it approaches its next earnings release. On that day, Digital Turbine is projected to report earnings of $0.32 per share, which would represent a year-over-year decline of 27.27%. Our most recent consensus estimate is calling for quarterly revenue of $176.3 million, down 43.17% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1.43 per share and revenue of $755.69 million. These totals would mark changes of -13.86% and -30.19%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for Digital Turbine. 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.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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 6.49% lower within the past month. Digital Turbine is holding a Zacks Rank of #5 (Strong Sell) right now.

Valuation is also important, so investors should note that Digital Turbine has a Forward P/E ratio of 12.3 right now. For comparison, its industry has an average Forward P/E of 42.33, which means Digital Turbine is trading at a discount to the group.

It is also worth noting that APPS currently has a PEG ratio of 1.23. 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. The Internet - Software industry currently had an average PEG ratio of 2.63 as of yesterday's close.

The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 139, putting it in the bottom 45% 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 APPS in the coming trading sessions, be sure to utilize Zacks.com.

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