While comparing the current values of a company's valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S) and price-to-cash flow (P/CF), with its own historical values helps determine whether its stock is fairly valued, overvalued, or undervalued, comparing the company relative to its peers on these parameters gives a good sense of the reasonability of the stock's price.Īs part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B B is better than C and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance. No investment decision can be efficient without considering a stock's valuation. The company topped consensus revenue estimates just once over this period. Over the last four quarters, the company surpassed EPS estimates just once. EPS of $0.14 for the same period compares with $0.49 a year ago.Ĭompared to the Zacks Consensus Estimate of $4.41 billion, the reported revenues represent a surprise of -0.51%. Lumen reported revenues of $4.39 billion in the last reported quarter, representing a year-over-year change of -10.2%. Last Reported Results and Surprise History For the current and next fiscal years, $17.56 billion and $15.06 billion estimates indicate -10.8% and -14.2% changes, respectively. Therefore, knowing a company's potential revenue growth is crucial.įor Lumen, the consensus sales estimate for the current quarter of $3.86 billion indicates a year-over-year change of -20.5%.
It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Over the past month, the estimate has changed -2.4%.ġ2-month consensus EPS estimate for LUMN _12MonthEPSChartUrlĮven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. Over the last 30 days, this estimate has changed -13.8%.įor the next fiscal year, the consensus earnings estimate of $0.81 indicates a change of -39.6% from what Lumen is expected to report a year ago. The Zacks Consensus Estimate has changed -16.6% over the last 30 days.įor the current fiscal year, the consensus earnings estimate of $1.34 points to a change of -29.8% from the prior year.
This is why empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.įor the current quarter, Lumen is expected to post earnings of $0.18 per share, indicating a change of -64.7% from the year-ago quarter. A higher fair value than the current market price drives investors' interest in buying the stock, leading to its price moving higher. And if earnings estimates go up for a company, the fair value for its stock goes up. We essentially look at how sell-side analysts covering the stock are revising their earnings estimates to reflect the impact of the latest business trends. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings. Rather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection.
The key question now is: What could be the stock's future direction?Īlthough media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision. During this period, the Zacks Technology Services industry, which Lumen falls in, has gained 4.4%. Over the past month, shares of this metal forging and stampings have returned -3.6%, compared to the Zacks S&P 500 composite's +5.9% change. So, you might want to look at some of the facts that could shape the stock's performance in the near term. Lumen (LUMN) has been one of the most searched-for stocks on lately.
0 kommentar(er)
