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Amazon (AMZN) Outpaces Stock Market Gains: What You Should Know

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Amazon (AMZN - Free Report) closed at $1,843.55 in the latest trading session, marking a +1.13% move from the prior day. This move outpaced the S&P 500's daily gain of 0.29%. Elsewhere, the Dow gained 0.17%, while the tech-heavy Nasdaq added 0.3%.

Heading into today, shares of the online retailer had gained 3.41% over the past month, lagging the Retail-Wholesale sector's gain of 5.23% and outpacing the S&P 500's gain of 2.99% in that time.

Investors will be hoping for strength from AMZN as it approaches its next earnings release. On that day, AMZN is projected to report earnings of $4.41 per share, which would represent a year-over-year decline of 23.3%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $68.52 billion, up 21.1% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $24.01 per share and revenue of $277.88 billion. These totals would mark changes of +19.22% and +19.32%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for AMZN. 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.

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 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 1.5% lower. AMZN currently has a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that AMZN has a Forward P/E ratio of 75.91 right now. Its industry sports an average Forward P/E of 27.06, so we one might conclude that AMZN is trading at a premium comparatively.

We can also see that AMZN currently has a PEG ratio of 2.36. 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 - Commerce stocks are, on average, holding a PEG ratio of 1.53 based on yesterday's closing prices.

The Internet - Commerce industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 91, putting it in the top 36% 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.

To follow AMZN in the coming trading sessions, be sure to utilize Zacks.com.


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