Square (SQ) closed the most recent trading day at $63, moving -1.3% from the previous trading session. This change lagged the S&P 500's 0.71% loss on the day. At the same time, the Dow lost 0.81%, and the tech-heavy Nasdaq lost 0.79%.
Prior to today's trading, shares of the mobile payments services provider had lost 4.93% over the past month. This has lagged the Computer and Technology sector's gain of 7.25% and the S&P 500's gain of 4.77% in that time.
SQ will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $0.21, up 50% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $1.18 billion, up 27.01% from the prior-year quarter.
Investors might also notice recent changes to analyst estimates for SQ. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
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 ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 6.93% higher within the past month. SQ is holding a Zacks Rank of #3 (Hold) right now.
Valuation is also important, so investors should note that SQ has a Forward P/E ratio of 67.19 right now. This valuation marks a premium compared to its industry's average Forward P/E of 52.83.
We can also see that SQ currently has a PEG ratio of 1.91. 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 was holding an average PEG ratio of 2.32 at yesterday's closing price.
The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 157, putting it in the bottom 39% 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.
To follow SQ in the coming trading sessions, be sure to utilize Zacks.com.
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