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SM Energy (SM) Stock Sinks As Market Gains: Here's Why

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SM Energy (SM - Free Report) closed the latest trading day at $49.39, indicating a -0.92% change from the previous session's end. The stock's performance was behind the S&P 500's daily gain of 0.09%. Elsewhere, the Dow saw a downswing of 0.1%, while the tech-heavy Nasdaq appreciated by 0.16%.

Shares of the independent oil and gas company have appreciated by 3.72% over the course of the past month, outperforming the Oils-Energy sector's loss of 0.69% and the S&P 500's gain of 2.83%.

The investment community will be closely monitoring the performance of SM Energy in its forthcoming earnings report. In that report, analysts expect SM Energy to post earnings of $1.61 per share. This would mark year-over-year growth of 25.78%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $630.69 million, up 14.51% from the year-ago period.

For the full year, the Zacks Consensus Estimates project earnings of $6.63 per share and a revenue of $2.58 billion, demonstrating changes of +12.56% and +8.86%, respectively, from the preceding year.

Furthermore, it would be beneficial for investors to monitor any recent shifts in analyst projections for SM Energy. Such recent modifications usually signify the changing landscape of near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.

Our research suggests that these changes in estimates have a direct relationship with upcoming 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.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the past month, there's been no change in the Zacks Consensus EPS estimate. Currently, SM Energy is carrying a Zacks Rank of #2 (Buy).

With respect to valuation, SM Energy is currently being traded at a Forward P/E ratio of 7.52. This indicates a discount in contrast to its industry's Forward P/E of 9.95.

The Oil and Gas - Exploration and Production - United States industry is part of the Oils-Energy sector. With its current Zacks Industry Rank of 81, this industry ranks in the top 33% of all industries, numbering over 250.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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