Sonos (SONO) Stock Sinks As Market Gains: What You Should Know
Sonos (SONO) closed at $29.98 in the latest trading session, marking a -0.43% move from the prior day. This change lagged the S&P 500's daily gain of 1.02%. Elsewhere, the Dow gained 0.74%, while the tech-heavy Nasdaq lost 0.4%.
Heading into today, shares of the maker of wireless speakers and home sound systems had lost 6.64% over the past month, lagging the Consumer Discretionary sector's loss of 6.46% and the S&P 500's loss of 0.91% in that time.
Investors will be hoping for strength from Sonos as it approaches its next earnings release. In that report, analysts expect Sonos to post earnings of $0.90 per share. This would mark a year-over-year decline of 23.08%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $647.17 million, up 0.25% from the year-ago period.
SONO's full-year Zacks Consensus Estimates are calling for earnings of $1.29 per share and revenue of $1.95 billion. These results would represent year-over-year changes of -27.12% and +13.77%, respectively.
It is also important to note the recent changes to analyst estimates for Sonos. 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. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, 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. Sonos is holding a Zacks Rank of #1 (Strong Buy) right now.
Digging into valuation, Sonos currently has a Forward P/E ratio of 23.3. This valuation marks a premium compared to its industry's average Forward P/E of 13.77.
Investors should also note that SONO has a PEG ratio of 1.37 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. Audio Video Production stocks are, on average, holding a PEG ratio of 1.53 based on yesterday's closing prices.
The Audio Video Production industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 71, 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.
To follow SONO in the coming trading sessions, be sure to utilize Zacks.com.
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