Benzinga - by Zacks, Benzinga Contributor.
The latest trading session saw Pinterest (NYSE: PINS) ending at $35.51, denoting a +1.54% adjustment from its last day's close. The stock outperformed the S&P 500, which registered a daily loss of 0.28%. Elsewhere, the Dow lost 0.08%, while the tech-heavy Nasdaq lost 0.42%.
Coming into today, shares of the digital pinboard and shopping tool company had lost 1.19% in the past month. In that same time, the Computer and Technology sector gained 3.64%, while the S&P 500 gained 2.67%.
Investors will be eagerly watching for the performance of Pinterest in its upcoming earnings disclosure. The company is predicted to post an EPS of $0.14, indicating a 75% growth compared to the equivalent quarter last year. Simultaneously, our latest consensus estimate expects the revenue to be $699.44 million, showing a 16.07% escalation compared to the year-ago quarter.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $1.34 per share and a revenue of $3.58 billion, representing changes of +22.94% and +17.32%, respectively, from the prior year.
Furthermore, it would be beneficial for investors to monitor any recent shifts in analyst projections for Pinterest. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 3.81% higher within the past month. Pinterest is currently a Zacks Rank #2 (Buy).
Looking at valuation, Pinterest is presently trading at a Forward P/E ratio of 26.16. For comparison, its industry has an average Forward P/E of 30.57, which means Pinterest is trading at a discount to the group.
Investors should also note that PINS has a PEG ratio of 1.3 right now. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. Internet - Software stocks are, on average, holding a PEG ratio of 1.84 based on yesterday's closing prices.
The Internet - Software industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 37, finds itself in the top 15% echelons of all 250+ industries.
The Zacks Industry Rank is ordered 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.
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