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Amazon (AMZN) Registers a Bigger Fall Than the Market: Important Facts to Note

Amazon (AMZN) closed at $183 in the latest trading session, marking a -1.68% move from the prior day. This move lagged the S&P 500's daily loss of 1.2%. Meanwhile, the Dow experienced a drop of 0.65%, and the technology-dominated Nasdaq saw a decrease of 1.79%.

The online retailer's stock has climbed by 6.71% in the past month, exceeding the Retail-Wholesale sector's loss of 0.91% and the S&P 500's loss of 0.85%.

The investment community will be closely monitoring the performance of Amazon in its forthcoming earnings report. The company is predicted to post an EPS of $0.81, indicating a 161.29% growth compared to the equivalent quarter last year. Our most recent consensus estimate is calling for quarterly revenue of $142.48 billion, up 11.88% from the year-ago period.

For the full year, the Zacks Consensus Estimates are projecting earnings of $4.08 per share and revenue of $641.45 billion, which would represent changes of +40.69% and +11.6%, respectively, from the prior year.

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Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Amazon. Such recent modifications usually signify the changing landscape of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. 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. Within the past 30 days, our consensus EPS projection remained stagnant. Currently, Amazon is carrying a Zacks Rank of #3 (Hold).

Looking at its valuation, Amazon is holding a Forward P/E ratio of 45.6. This represents a premium compared to its industry's average Forward P/E of 20.18.

It is also worth noting that AMZN currently has a PEG ratio of 1.62. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. As the market closed yesterday, the Internet - Commerce industry was having an average PEG ratio of 0.67.

The Internet - Commerce industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 42, which puts it in the top 17% 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.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.

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Amazon.com, Inc. (AMZN) : Free Stock Analysis Report

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Zacks Investment Research