Square (SQ) Outpaces Stock Market Gains: What You Should Know
Square (SQ) closed at $261.65 in the latest trading session, marking a +1.27% move from the prior day. This change outpaced the S&P 500's 0.77% gain on the day.
Heading into today, shares of the mobile payments services provider had gained 8.11% over the past month, lagging the Computer and Technology sector's gain of 10.54% and outpacing the S&P 500's gain of 7.34% in that time.
Investors will be hoping for strength from SQ as it approaches its next earnings release, which is expected to be May 6, 2021. In that report, analysts expect SQ to post earnings of $0.15 per share. This would mark year-over-year growth of 850%. Meanwhile, our latest consensus estimate is calling for revenue of $3.37 billion, up 143.69% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1.17 per share and revenue of $14.3 billion. These totals would mark changes of +39.29% and +50.6%, respectively, from last year.
Any recent changes to analyst estimates for SQ should also be noted by investors. 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.
Our research shows that these estimate changes are directly correlated with near-term stock prices. 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.
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. The Zacks Consensus EPS estimate has moved 0.57% lower within the past month. SQ is holding a Zacks Rank of #3 (Hold) right now.
Looking at its valuation, SQ is holding a Forward P/E ratio of 210.1. For comparison, its industry has an average Forward P/E of 67.57, which means SQ is trading at a premium to the group.
Meanwhile, SQ's PEG ratio is currently 5.88. 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. SQ's industry had an average PEG ratio of 3.68 as of yesterday's close.
The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 208, which puts it in the bottom 19% 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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