PagSeguro Digital Ltd. (PAGS) Stock Falls Amid Market Uptick: What Investors Need to Know

In the latest trading session, PagSeguro Digital Ltd. (PAGS) closed at $10.34, marking a -1.8% move from the previous day. The stock trailed the S&P 500, which registered a daily gain of 0.11%. Elsewhere, the Dow saw a downswing of 0.13%, while the tech-heavy Nasdaq appreciated by 0.18%.

Coming into today, shares of the company had lost 0.38% in the past month. In that same time, the Business Services sector lost 6.27%, while the S&P 500 lost 4.28%.

The investment community will be paying close attention to the earnings performance of PagSeguro Digital Ltd. in its upcoming release. In that report, analysts expect PagSeguro Digital Ltd. to post earnings of $0.39 per share. This would mark year-over-year growth of 25.81%. Simultaneously, our latest consensus estimate expects the revenue to be $984.75 million, showing a 19.06% escalation compared to the year-ago quarter.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $1.67 per share and a revenue of $4.04 billion, representing changes of +17.61% and +10.36%, respectively, from the prior year.

Investors should also take note of any recent adjustments to analyst estimates for PagSeguro Digital Ltd. These revisions typically reflect the latest short-term business trends, which can change frequently. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. 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.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.91% higher. At present, PagSeguro Digital Ltd. boasts a Zacks Rank of #2 (Buy).

Looking at valuation, PagSeguro Digital Ltd. is presently trading at a Forward P/E ratio of 6.31. Its industry sports an average Forward P/E of 9.84, so one might conclude that PagSeguro Digital Ltd. is trading at a discount comparatively.

Investors should also note that PAGS has a PEG ratio of 0.42 right now. 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. By the end of yesterday's trading, the Financial Transaction Services industry had an average PEG ratio of 0.79.

The Financial Transaction Services industry is part of the Business Services sector. This industry currently has a Zacks Industry Rank of 158, which puts it in the bottom 36% of all 250+ industries.

The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained 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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This article originally published on Zacks Investment Research (zacks.com).

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