Zynga (ZNGA) closed at $6.23 in the latest trading session, marking a -0.16% move from the prior day. This change was narrower than the S&P 500's daily loss of 0.39%. At the same time, the Dow lost 0.95%, and the tech-heavy Nasdaq lost 0.83%.
Coming into today, shares of the maker of "FarmVille" and other online games had gained 1.96% in the past month. In that same time, the Consumer Discretionary sector lost 1.71%, while the S&P 500 lost 0.1%.
ZNGA will be looking to display strength as it nears its next earnings release, which is expected to be October 30, 2019. The company is expected to report EPS of $0.05, up 66.67% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $385.15 million, up 54.75% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $0.22 per share and revenue of $1.51 billion. These totals would mark changes of +175% and +55.93%, respectively, from last year.
Investors might also notice recent changes to analyst estimates for ZNGA. These revisions typically reflect the latest short-term business trends, which can change frequently. 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. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, 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. Over the past month, the Zacks Consensus EPS estimate remained stagnant. ZNGA is currently sporting a Zacks Rank of #3 (Hold).
Digging into valuation, ZNGA currently has a Forward P/E ratio of 28.36. This valuation marks a premium compared to its industry's average Forward P/E of 19.68.
Also, we should mention that ZNGA has a PEG ratio of 1.88. 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. ZNGA's industry had an average PEG ratio of 1.51 as of yesterday's close.
The Gaming industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 191, which puts it in the bottom 26% 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.
To follow ZNGA in the coming trading sessions, be sure to utilize Zacks.com.
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