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Diodes (DIOD) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research

Diodes (DIOD) closed at $40.80 in the latest trading session, marking a -0.15% move from the prior day. This move lagged the S&P 500's daily gain of 0.29%. Elsewhere, the Dow gained 0.17%, while the tech-heavy Nasdaq added 0.3%.

Heading into today, shares of the semiconductor components maker had gained 12.1% over the past month, outpacing the Computer and Technology sector's gain of 3.47% and the S&P 500's gain of 2.99% in that time.

Investors will be hoping for strength from DIOD as it approaches its next earnings release. On that day, DIOD is projected to report earnings of $0.78 per share, which would represent year-over-year growth of 14.71%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $324 million, up 0.95% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2.85 per share and revenue of $1.25 billion. These totals would mark changes of +19.75% and +3.2%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for DIOD. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

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 ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. DIOD currently has a Zacks Rank of #2 (Buy).

Valuation is also important, so investors should note that DIOD has a Forward P/E ratio of 14.34 right now. Its industry sports an average Forward P/E of 19.81, so we one might conclude that DIOD is trading at a discount comparatively.

The Electronics - Semiconductors industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 100, putting it in the top 40% 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 DIOD in the coming trading sessions, be sure to utilize Zacks.com.


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