This story originally appeared on Zacks
In the latest trading session, StoneCo Ltd. (STNE) closed at $12.45, marking a -1.81% move from the previous day. This change lagged the S&P 500’s 0.38% loss on the day. Meanwhile, the Dow lost 0.5%, and the Nasdaq, a tech-heavy index, lost 0.05%.
Coming into today, shares of the company had lost 23.71% in the past month. In that same time, the Computer and Technology sector lost 8.71%, while the S&P 500 lost 6.25%.
StoneCo Ltd. will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $0.01, down 94.74% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $200.72 million, up 8.12% from the prior-year quarter.
Investors might also notice recent changes to analyst estimates for StoneCo Ltd.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.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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 ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 4.72% lower. StoneCo Ltd. is holding a Zacks Rank of #5 (Strong Sell) right now.
In terms of valuation, StoneCo Ltd. is currently trading at a Forward P/E ratio of 37.66. This represents a discount compared to its industry’s average Forward P/E of 52.41.
The Internet – Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 158, which puts it in the bottom 39% 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.
To follow STNE in the coming trading sessions, be sure to utilize Zacks.com.
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