In the latest trading session, Zynga (ZNGA) closed at $9.33, marking a -1.17% move from the previous day. This move was narrower than the S&P 500's daily loss of 1.86%. Meanwhile, the Dow lost 2.3%, and the Nasdaq, a tech-heavy index, lost 1.64%.
Prior to today's trading, shares of the maker of "FarmVille" and other online games had gained 6.67% over the past month. This has outpaced the Consumer Discretionary sector's gain of 3.34% and lagged the S&P 500's gain of 7.63% in that time.
ZNGA will be looking to display strength as it nears its next earnings release, which is expected to be November 4, 2020. Meanwhile, our latest consensus estimate is calling for revenue of $627.14 million, up 58.85% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $0.36 per share and revenue of $2.22 billion, which would represent changes of +3500% and +41.89%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for ZNGA. These recent revisions tend to reflect the evolving nature of short-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. 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.
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. Within the past 30 days, our consensus EPS projection has moved 2.19% higher. ZNGA is holding a Zacks Rank of #4 (Sell) right now.
Digging into valuation, ZNGA currently has a Forward P/E ratio of 26.33. For comparison, its industry has an average Forward P/E of 29.44, which means ZNGA is trading at a discount to the group.
Also, we should mention that ZNGA has a PEG ratio of 1.31. 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. ZNGA's industry had an average PEG ratio of 1.14 as of yesterday's close.
The Gaming industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 214, putting it in the bottom 16% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our 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.
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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Zynga Inc. (ZNGA) : Free Stock Analysis Report
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