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Square (SQ) Stock Sinks As Market Gains: What You Should Know

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Square (SQ - Free Report) closed at $74.95 in the latest trading session, marking a -0.11% move from the prior day. This change lagged the S&P 500's 0.11% gain on the day. At the same time, the Dow lost 0.32%, and the tech-heavy Nasdaq gained 0.19%.

Heading into today, shares of the mobile payments services provider had gained 1.24% over the past month, lagging the Computer and Technology sector's gain of 5.46% and the S&P 500's gain of 3.84% in that time.

Investors will be hoping for strength from SQ as it approaches its next earnings release, which is expected to be May 1, 2019. In that report, analysts expect SQ to post earnings of $0.08 per share. This would mark year-over-year growth of 33.33%. Meanwhile, our latest consensus estimate is calling for revenue of $937.63 million, up 40.24% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $0.74 per share and revenue of $4.41 billion, which would represent changes of +57.45% and +33.7%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for SQ. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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. Within the past 30 days, our consensus EPS projection remained stagnant. SQ currently has a Zacks Rank of #2 (Buy).

Digging into valuation, SQ currently has a Forward P/E ratio of 101.65. Its industry sports an average Forward P/E of 55.47, so we one might conclude that SQ is trading at a premium comparatively.

Meanwhile, SQ's PEG ratio is currently 4.07. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Internet - Software was holding an average PEG ratio of 3.18 at yesterday's closing price.

The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 49, putting it in the top 20% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. 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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