Ooma (OOMA) closed the most recent trading day at $15.90, moving -1.55% from the previous trading session. This change lagged the S&P 500's 0.84% gain on the day. At the same time, the Dow added 0.03%, and the tech-heavy Nasdaq gained 2.51%.
Coming into today, shares of the internet phone service provider had gained 17.88% in the past month. In that same time, the Computer and Technology sector gained 5.23%, while the S&P 500 gained 3.73%.
Wall Street will be looking for positivity from OOMA as it approaches its next earnings report date. The company is expected to report EPS of $0.07, up 275% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $40.17 million, up 7.57% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $0.25 per share and revenue of $162.04 million, which would represent changes of +933.33% and +6.89%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for OOMA. 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.
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. OOMA currently has a Zacks Rank of #2 (Buy).
Looking at its valuation, OOMA is holding a Forward P/E ratio of 64.6. This represents a premium compared to its industry's average Forward P/E of 28.65.
Also, we should mention that OOMA has a PEG ratio of 1.35. 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 Communication - Components was holding an average PEG ratio of 2.81 at yesterday's closing price.
The Communication - Components industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 70, which puts 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.
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