U.S. Markets open in 5 hrs 9 mins

Twitter (TWTR) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research

Twitter (TWTR) closed the most recent trading day at $40.25, moving +1.18% from the previous trading session. The stock outpaced the S&P 500's daily gain of 1%.

Heading into today, shares of the short messaging service had lost 6.97% over the past month, lagging the Computer and Technology sector's loss of 0.45% and the S&P 500's loss of 1.22% in that time.

Investors will be hoping for strength from TWTR as it approaches its next earnings release, which is expected to be October 24, 2019. The company is expected to report EPS of $0.20, down 4.76% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $876.26 million, up 15.58% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $2.46 per share and revenue of $3.56 billion, which would represent changes of +186.05% and +17.06%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for TWTR. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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. Within the past 30 days, our consensus EPS projection remained stagnant. TWTR is holding a Zacks Rank of #3 (Hold) right now.

In terms of valuation, TWTR is currently trading at a Forward P/E ratio of 16.19. This represents a discount compared to its industry's average Forward P/E of 55.75.

Meanwhile, TWTR's PEG ratio is currently 0.69. 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. TWTR's industry had an average PEG ratio of 2.7 as of yesterday's close.

The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 66, putting it in the top 26% 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Twitter, Inc. (TWTR) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research