In the latest trading session, Zendesk (ZEN) closed at $84.70, marking a +0.85% move from the previous day. The stock outpaced the S&P 500's daily gain of 0.84%. At the same time, the Dow added 0.92%, and the tech-heavy Nasdaq gained 1.06%.
Prior to today's trading, shares of the customer-service software maker had gained 10.14% over the past month. This has outpaced the Computer and Technology sector's gain of 6.54% and the S&P 500's gain of 3.95% in that time.
Wall Street will be looking for positivity from ZEN as it approaches its next earnings report date. This is expected to be February 6, 2020. On that day, ZEN is projected to report earnings of $0.11 per share, which would represent year-over-year growth of 10%. Our most recent consensus estimate is calling for quarterly revenue of $227.82 million, up 32.26% from the year-ago period.
It is also important to note the recent changes to analyst estimates for ZEN. Recent revisions tend to reflect the latest near-term business trends. 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.
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. The Zacks Consensus EPS estimate remained stagnant within the past month. ZEN currently has a Zacks Rank of #2 (Buy).
Digging into valuation, ZEN currently has a Forward P/E ratio of 143.57. For comparison, its industry has an average Forward P/E of 56.99, which means ZEN is trading at a premium to the group.
Meanwhile, ZEN's PEG ratio is currently 4.86. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Internet - Software was holding an average PEG ratio of 2.55 at yesterday's closing price.
The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 102, which puts it in the top 40% 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.
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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