Discovery Communications (DISCA) is sinking more than just broader markets: what you need to know
Discovery Communications (DISCA) closed at $28.68 last trading session, marking a -1.92% move from the previous day. That move lagged the S&P 500’s daily 0.53% loss. Elsewhere, the Dow Jones lost 0.29%, while the tech-heavy Nasdaq lost 0.1%.
Today, shares of the operator of cable TV channels such as TLC and Animal Planet gained 5.6% over the past month, outpacing the Consumer Discretionary sector’s 3.03% loss and the loss of 4.24% of the S&P 500 during this period.
Wall Street will be looking for positivity from Discovery Communications as its next earnings report date nears. The company is expected to post EPS of $0.54, up 157.14% from the prior year quarter. Meanwhile, Zacks’ consensus estimate for revenue calls for net sales of $3.18 billion, up 13.79% from the year-ago period.
For the full year, our Zacks consensus estimates call for earnings of $2.89 per share and revenue of $12.58 billion, which would represent swings of +79.5% and +3, 16%, respectively, compared to the previous year.
Investors might also notice recent changes in analyst estimates for Discovery Communications. These revisions help show the ever-changing nature of short-term trading trends. With this in mind, we can view positive estimate revisions as a sign of optimism about the company’s business outlook.
Research indicates that these revisions to estimates are directly correlated to near-term stock price dynamics. To benefit from this, we have developed the Zacks Rank, a proprietary model that takes into account these estimation changes and provides an actionable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive track record of outperformance verified by external audits, with #1 stocks generating an average annual return of +25% since 1988 Over the past month, the Zacks Consensus EPS estimate fell 4.26%. Discovery Communications currently sports a Zacks rank of #3 (Hold).
Digging into the valuation, Discovery Communications currently has a Forward P/E ratio of 10.13. Its industry sports an average Forward P/E of 11.59, so we can conclude that Discovery Communications is trading at a comparative price.
Additionally, it is worth mentioning that DISCA has a PEG ratio of 0.95. This measure is used in the same way as the famous P/E ratio, but the PEG ratio also takes into account the growth rate of the stock’s expected earnings. The DISCA industry had an average PEG ratio of 1.4 at yesterday’s close.
The radio and television industry is part of the consumer discretionary sector. This industry currently has a Zacks Industry Rank of 185, which places it in the bottom 28% of all 250+ industries.
The Zacks Industry Rankings are ranked from best to worst in terms of the average Zacks Ranking of individual companies in each of these industries. Our research shows that the top 50% of industries outperform the bottom half by a factor of 2 to 1.
Be sure to use Zacks.com to track all of these stock movement metrics, and more, in future trading sessions.
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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.