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EGain (EGAN) Gains But Lags Market: What You Should Know

Zacks Equity Research
Tech Data (TECD) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

eGain (EGAN) closed the most recent trading day at $12.46, moving +0.16% from the previous trading session. The stock lagged the S&P 500's daily gain of 0.7%. Meanwhile, the Dow gained 0.58%, and the Nasdaq, a tech-heavy index, added 0.69%.

Coming into today, shares of the maker of customer engagement software had gained 8.36% in the past month. In that same time, the Computer and Technology sector gained 3.68%, while the S&P 500 gained 1.95%.

Investors will be hoping for strength from EGAN as it approaches its next earnings release. On that day, EGAN is projected to report earnings of $0.03 per share, which would represent year-over-year growth of 50%. Meanwhile, our latest consensus estimate is calling for revenue of $16.92 million, up 7.43% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $0.19 per share and revenue of $67.71 million, which would represent changes of +216.67% and +10.44%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for EGAN. These revisions help to show the ever-changing nature of near-term business trends. 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.

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. Within the past 30 days, our consensus EPS projection remained stagnant. EGAN currently has a Zacks Rank of #1 (Strong Buy).

Looking at its valuation, EGAN is holding a Forward P/E ratio of 65.47. This represents a premium compared to its industry's average Forward P/E of 58.17.

Investors should also note that EGAN has a PEG ratio of 2.18 right now. 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. EGAN's industry had an average PEG ratio of 2.93 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 71, putting it in the top 28% 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.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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