Sony (SONY) Increases Despite Market Slip: Here's What You Need to Know

In the latest close session, Sony (SONY) was up +1.18% at $20.62. The stock outperformed the S&P 500, which registered a daily loss of 0.28%. At the same time, the Dow lost 0.44%, and the tech-heavy Nasdaq lost 0.28%.

The stock of electronics and media company has fallen by 9.42% in the past month, lagging the Consumer Discretionary sector's loss of 4.13% and the S&P 500's loss of 3.59%.

Market participants will be closely following the financial results of Sony in its upcoming release. The company is forecasted to report an EPS of $0.14, showcasing a 33.33% downward movement from the corresponding quarter of the prior year. At the same time, our most recent consensus estimate is projecting a revenue of $17.99 billion, reflecting a 4.29% rise from the equivalent quarter last year.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $1.24 per share and revenue of $78.42 billion. These totals would mark changes of +0.81% and -7.79%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for Sony. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the business and profitability.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 1.64% higher within the past month. As of now, Sony holds a Zacks Rank of #3 (Hold).

In the context of valuation, Sony is at present trading with a Forward P/E ratio of 16.43. For comparison, its industry has an average Forward P/E of 11.11, which means Sony is trading at a premium to the group.

One should further note that SONY currently holds a PEG ratio of 7.24. 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. The Audio Video Production was holding an average PEG ratio of 7.24 at yesterday's closing price.

The Audio Video Production industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 25, putting it in the top 11% 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.

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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