In the latest trading session, Square (SQ) closed at $245.25, marking a -0.1% move from the previous day. This move lagged the S&P 500's daily gain of 0.93%.
Heading into today, shares of the mobile payments services provider had gained 8.49% over the past month, lagging the Computer and Technology sector's gain of 8.56% and outpacing the S&P 500's gain of 5.84% in that time.
Wall Street will be looking for positivity from SQ as it approaches its next earnings report date. This is expected to be May 6, 2021. In that report, analysts expect SQ to post earnings of $0.15 per share. This would mark year-over-year growth of 850%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $3.37 billion, up 143.69% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $1.17 per share and revenue of $14.3 billion, which would represent changes of +39.29% and +50.6%, respectively, from the prior year.
Investors should also note any recent changes to analyst estimates for SQ. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
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. Over the past month, the Zacks Consensus EPS estimate has moved 0.57% lower. SQ is currently a Zacks Rank #3 (Hold).
Digging into valuation, SQ currently has a Forward P/E ratio of 214.4. For comparison, its industry has an average Forward P/E of 76.52, which means SQ is trading at a premium to the group.
Also, we should mention that SQ has a PEG ratio of 6. 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. Internet - Software stocks are, on average, holding a PEG ratio of 4.07 based on yesterday's closing prices.
The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 185, which puts it in the bottom 28% of all 250+ industries.
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