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Twitter (TWTR) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research
·2-min read

In the latest trading session, Twitter (TWTR) closed at $66.11, marking a +1.96% move from the previous day. This move outpaced the S&P 500's daily gain of 0.74%.

Prior to today's trading, shares of the short messaging service had gained 6.38% over the past month. This has outpaced the Computer and Technology sector's loss of 0.81% and the S&P 500's gain of 1.34% in that time.

Wall Street will be looking for positivity from TWTR as it approaches its next earnings report date. This is expected to be October 26, 2021. On that day, TWTR is projected to report earnings of $0.17 per share, which would represent a year-over-year decline of 10.53%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.29 billion, up 37.56% from the year-ago period.

TWTR's full-year Zacks Consensus Estimates are calling for earnings of $0.93 per share and revenue of $5.1 billion. These results would represent year-over-year changes of +206.9% and +37.33%, respectively.

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Investors should also note any recent changes to analyst estimates for TWTR. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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. TWTR currently has a Zacks Rank of #3 (Hold).

Looking at its valuation, TWTR is holding a Forward P/E ratio of 69.63. This valuation marks a premium compared to its industry's average Forward P/E of 63.36.

The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 171, which puts it in the bottom 33% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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