Splunk (SPLK) closed at $155.58 in the latest trading session, marking a +1.29% move from the prior day. This move outpaced the S&P 500's daily gain of 1.01%. Elsewhere, the Dow gained 0.66%, while the tech-heavy Nasdaq added 1.43%.
Prior to today's trading, shares of the maker of software that helps companies collect and analyze internal data had gained 3.12% over the past month. This has outpaced the Computer and Technology sector's gain of 2.89% and the S&P 500's gain of 0.19% in that time.
SPLK will be looking to display strength as it nears its next earnings release. On that day, SPLK is projected to report earnings of $0.96 per share, which would represent year-over-year growth of 3.23%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $783.94 million, up 26.02% from the year-ago period.
SPLK's full-year Zacks Consensus Estimates are calling for earnings of $1.87 per share and revenue of $2.35 billion. These results would represent year-over-year changes of +40.6% and +30.43%, respectively.
It is also important to note the recent changes to analyst estimates for SPLK. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about 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. Over the past month, the Zacks Consensus EPS estimate remained stagnant. SPLK currently has a Zacks Rank of #1 (Strong Buy).
Looking at its valuation, SPLK is holding a Forward P/E ratio of 82.08. For comparison, its industry has an average Forward P/E of 56.47, which means SPLK is trading at a premium to the group.
Meanwhile, SPLK's PEG ratio is currently 2.63. 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. Internet - Software stocks are, on average, holding a PEG ratio of 2.65 based on yesterday's closing prices.
The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 98, which puts it in the top 39% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. 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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