Epam (EPAM) Gains As Market Dips: What You Should Know

Epam (EPAM) closed at $306.65 in the latest trading session, marking a +1.02% move from…

Epam (EPAM) closed at $306.65 in the latest trading session, marking a +1.02% move from the prior day. This change outpaced the S&P 500’s 1.23% loss on the day. At the same time, the Dow lost 1.29%, and the tech-heavy Nasdaq lost 0.14%.

Heading into today, shares of the information technology services provider had lost 29.04% over the past month, lagging the Computer and Technology sector’s gain of 4.45% and the S&P 500’s gain of 5.04% in that time.

Wall Street will be looking for positivity from Epam as it approaches its next earnings report date. The company is expected to report EPS of $2.32, up 28.18% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $1.09 billion, up 39.38% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $10.65 per share and revenue of $4.86 billion, which would represent changes of +17.68% and +29.36%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for Epam. 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.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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. Over the past month, the Zacks Consensus EPS estimate has moved 11.74% lower. Epam is currently a Zacks Rank #3 (Hold).

In terms of valuation, Epam is currently trading at a Forward P/E ratio of 28.51. For comparison, its industry has an average Forward P/E of 19.16, which means Epam is trading at a premium to the group.

It is also worth noting that EPAM currently has a PEG ratio of 1.11. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company’s expected earnings growth rate into account. EPAM’s industry had an average PEG ratio of 1.11 as of yesterday’s close.

The Computers – IT Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 194, putting it in the bottom 24% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.

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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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