NetEase (NTES) closed the most recent trading day at $337.85, moving -1.42% from the previous trading session. This change lagged the S&P 500's daily gain of 1.13%. At the same time, the Dow added 1.68%, and the tech-heavy Nasdaq gained 0.43%.
Coming into today, shares of the internet technology company had gained 4.48% in the past month. In that same time, the Computer and Technology sector gained 5.2%, while the S&P 500 gained 2.1%.
NTES will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $3.02, up 13.53% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $2.16 billion, down 25.31% from the prior-year quarter.
Any recent changes to analyst estimates for NTES should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. 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.
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. The Zacks Consensus EPS estimate remained stagnant within the past month. NTES currently has a Zacks Rank of #2 (Buy).
Valuation is also important, so investors should note that NTES has a Forward P/E ratio of 22.13 right now. This valuation marks a discount compared to its industry's average Forward P/E of 23.24.
Investors should also note that NTES has a PEG ratio of 0.53 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Internet - Software and Services industry currently had an average PEG ratio of 5.53 as of yesterday's close.
The Internet - Software and Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 60, putting it in the top 24% 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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