Western Digital (WDC) Gains But Lags Market: What You Should Know

In the latest trading session, Western Digital (WDC) closed at $59.62, marking a +0.27% move from the previous day. The stock lagged the S&P 500's daily gain of 0.28%. At the same time, the Dow added 0.09%, and the tech-heavy Nasdaq gained 0.4%.

Prior to today's trading, shares of the maker of hard drives for businesses and personal computers had lost 6.45% over the past month. This has lagged the Computer and Technology sector's gain of 0.51% and the S&P 500's loss of 0.14% in that time.

Wall Street will be looking for positivity from WDC as it approaches its next earnings report date. This is expected to be October 30, 2019. In that report, analysts expect WDC to post earnings of $0.27 per share. This would mark a year-over-year decline of 91.12%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $3.90 billion, down 22.39% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $3.04 per share and revenue of $16.56 billion, which would represent changes of -37.19% and -0.06%, respectively, from the prior year.

Any recent changes to analyst estimates for WDC should also be noted by investors. These revisions help to show the ever-changing nature of 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.

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. Within the past 30 days, our consensus EPS projection remained stagnant. WDC is holding a Zacks Rank of #3 (Hold) right now.

Investors should also note WDC's current valuation metrics, including its Forward P/E ratio of 19.55. This valuation marks a no noticeable deviation compared to its industry's average Forward P/E of 19.55.

Investors should also note that WDC has a PEG ratio of 9.77 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. WDC's industry had an average PEG ratio of 4.14 as of yesterday's close.

The Computer- Storage Devices industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 33, which puts it in the top 13% 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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