Amazon (AMZN) Dips More Than Broader Markets: What You Should Know

Amazon (AMZN) closed the most recent trading day at $1,764.73, moving -1.07% from the previous trading session. This change lagged the S&P 500's daily loss of 0.46%. Meanwhile, the Dow lost 0.13%, and the Nasdaq, a tech-heavy index, lost 0.63%.

Heading into today, shares of the online retailer had gained 9.01% over the past month, outpacing the Retail-Wholesale sector's gain of 1.99% and the S&P 500's gain of 1.08% in that time.

Investors will be hoping for strength from AMZN as it approaches its next earnings release. In that report, analysts expect AMZN to post earnings of $4.67 per share. This would mark year-over-year growth of 42.81%. Our most recent consensus estimate is calling for quarterly revenue of $59.59 billion, up 16.75% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $26.93 per share and revenue of $275.58 billion. These totals would mark changes of +33.71% and +18.33%, respectively, from last year.

Investors should also note any 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. 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. Over the past month, the Zacks Consensus EPS estimate has moved 0.77% higher. AMZN is holding a Zacks Rank of #3 (Hold) right now.

Looking at its valuation, AMZN is holding a Forward P/E ratio of 66.25. This represents a premium compared to its industry's average Forward P/E of 28.33.

It is also worth noting that AMZN currently has a PEG ratio of 2.13. 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. The Internet - Commerce was holding an average PEG ratio of 2.09 at yesterday's closing price.

The Internet - Commerce industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 198, putting it in the bottom 23% 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.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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