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

Zacks Equity Research
Amphenol (APH) reported earnings 30 days ago. What's next for the stock? We take a look at earnings estimates for some clues.

Digital Turbine (APPS) closed at $3.56 in the latest trading session, marking a -0.28% move from the prior day. This change lagged the S&P 500's 0.88% gain on the day. At the same time, the Dow added 0.55%, and the tech-heavy Nasdaq gained 1.32%.

Heading into today, shares of the mobile software company had gained 15.53% over the past month, outpacing the Computer and Technology sector's gain of 5% and the S&P 500's gain of 3.96% in that time.

Wall Street will be looking for positivity from APPS as it approaches its next earnings report date. The company is expected to report EPS of $0.02, up 300% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $26.55 million, up 26.67% from the year-ago period.

It is also important to note the recent changes to analyst estimates for APPS. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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. Over the past month, the Zacks Consensus EPS estimate remained stagnant. APPS is currently sporting a Zacks Rank of #2 (Buy).

Valuation is also important, so investors should note that APPS has a Forward P/E ratio of 30.6 right now. Its industry sports an average Forward P/E of 52.76, so we one might conclude that APPS is trading at a discount comparatively.

The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 37, putting it in the top 15% 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.

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


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