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Western Digital (WDC) Gains But Lags Market: What You Should Know

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Western Digital (WDC) closed the most recent trading day at $49.95, moving +1.44% from the previous trading session. The stock lagged the S&P 500's daily gain of 1.46%. Elsewhere, the Dow gained 1%, while the tech-heavy Nasdaq lost 0.18%.

Heading into today, shares of the maker of hard drives for businesses and personal computers had lost 19.53% over the past month, lagging the Computer and Technology sector's loss of 7.96% and the S&P 500's loss of 6.94% in that time.

Wall Street will be looking for positivity from Western Digital as it approaches its next earnings report date. In that report, analysts expect Western Digital to post earnings of $1.76 per share. This would mark a year-over-year decline of 18.52%. Meanwhile, our latest consensus estimate is calling for revenue of $4.62 billion, down 6.12% from the prior-year quarter.

WDC's full-year Zacks Consensus Estimates are calling for earnings of $8.20 per share and revenue of $18.88 billion. These results would represent year-over-year changes of +80.22% and +11.57%, respectively.

Investors should also note any recent changes to analyst estimates for Western Digital. 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.

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.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Western Digital is currently sporting a Zacks Rank of #3 (Hold).

In terms of valuation, Western Digital is currently trading at a Forward P/E ratio of 6.01. For comparison, its industry has an average Forward P/E of 11.77, which means Western Digital is trading at a discount to the group.

The Computer- Storage Devices industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 89, which puts it in the top 36% 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.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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