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Amazon (AMZN) Gains As Market Dips: What You Should Know

Amazon (AMZN) closed the most recent trading day at $115.15, moving +1.2% from the previous trading session. This change outpaced the S&P 500's 1.03% loss on the day. Elsewhere, the Dow lost 1.11%, while the tech-heavy Nasdaq lost 0.12%.

Prior to today's trading, shares of the online retailer had lost 12.98% over the past month. This has lagged the Retail-Wholesale sector's loss of 10.27% and the S&P 500's loss of 10.4% in that time.

Investors will be hoping for strength from Amazon as it approaches its next earnings release. The company is expected to report EPS of $0.27, down 12.9% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $128.19 billion, up 15.68% from the year-ago period.

AMZN's full-year Zacks Consensus Estimates are calling for earnings of $0.21 per share and revenue of $523.76 billion. These results would represent year-over-year changes of -93.52% and +11.48%, respectively.

Investors might also notice recent changes to analyst estimates for Amazon. These revisions typically reflect the latest short-term business trends, which can change frequently. 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. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.75% higher. Amazon is holding a Zacks Rank of #3 (Hold) right now.

Valuation is also important, so investors should note that Amazon has a Forward P/E ratio of 539.47 right now. For comparison, its industry has an average Forward P/E of 22.88, which means Amazon is trading at a premium to the group.

We can also see that AMZN currently has a PEG ratio of 26.65. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Internet - Commerce industry currently had an average PEG ratio of 1.1 as of yesterday's close.

The Internet - Commerce industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 151, putting it in the bottom 41% 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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