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Ubiquiti Networks (UBNT) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research
Alibaba (BABA) closed the most recent trading day at $174.19, moving +0.4% from the previous trading session.

Ubiquiti Networks (UBNT) closed at $166.79 in the latest trading session, marking a -0.93% move from the prior day. This move lagged the S&P 500's daily loss of 0.04%. At the same time, the Dow lost 0.51%, and the tech-heavy Nasdaq gained 0.21%.

Heading into today, shares of the computer networking company had gained 16.14% over the past month, outpacing the Computer and Technology sector's gain of 5.87% and the S&P 500's gain of 4.65% in that time.

Investors will be hoping for strength from UBNT as it approaches its next earnings release. In that report, analysts expect UBNT to post earnings of $1.06 per share. This would mark year-over-year growth of 8.16%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $257.28 million, up 2.75% from the year-ago period.

UBNT's full-year Zacks Consensus Estimates are calling for earnings of $4.66 per share and revenue of $1.12 billion. These results would represent year-over-year changes of +26.29% and +10.56%, respectively.

Any recent changes to analyst estimates for UBNT should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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. UBNT is holding a Zacks Rank of #3 (Hold) right now.

Digging into valuation, UBNT currently has a Forward P/E ratio of 36.13. Its industry sports an average Forward P/E of 24.71, so we one might conclude that UBNT is trading at a premium comparatively.

Meanwhile, UBNT's PEG ratio is currently 1.78. 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. UBNT's industry had an average PEG ratio of 2.51 as of yesterday's close.

The Wireless Equipment industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 53, which puts it in the top 21% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.

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