Sonos (SONO) shares move -1.76%: What you need to know

Sonos (SONO) closed the last trading day at $22.82, moving -1.76% from the previous trading session. That move was narrower than the S&P 500’s 3.63% daily loss. Elsewhere, the Dow Jones lost 2.77%, while the tech-heavy Nasdaq lost 0.19%.

Heading into today, shares of the wireless speaker and home audio system maker had lost 17.68% over the past month, lagging the sector’s 12.22% loss consumer discretionary and the 6.15% loss in the S&P 500 during this period.

Wall Street will be looking for positivity from Sonos as it nears its next earnings report date. That is expected to be May 11, 2022. The company is expected to report EPS of $0.04, down 87.1% from the prior year quarter. Our most recent consensus estimate calls for quarterly revenue of $361.4 million, up 8.55% from the prior year period.

Looking to the full year, our Zacks consensus estimates suggest analysts are expecting earnings of $1.23 per share and revenue of $1.98 billion. These totals would mark changes of -30.51% and +15.37%, respectively, from last year.

It’s also important to note recent changes to analyst estimates for Sonos. These recent revisions tend to reflect the evolving nature of short-term trading trends. Thus, positive revisions to estimates reflect analysts’ optimism about the company’s business and profitability.

Research indicates that these revisions to estimates are directly correlated to near-term stock price dynamics. Investors can take advantage of this by using the Zacks ranking. This model accounts for these estimation changes and provides a simple and actionable scoring 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 has remained flat. Sonos currently sports a Zacks rating of #3 (Hold).

In terms of valuation, Sonos is currently trading at a forward P/E ratio of 18.89. Its industry sports an average Forward P/E of 11.38, so we can conclude that Sonos is trading at a premium comparatively.

Additionally, it is worth mentioning that SONO has a PEG ratio of 1.31. The PEG ratio is similar to the widely used P/E ratio, but this measure also takes into account the company’s expected earnings growth rate. Audiovisual production held an average PEG ratio of 1.29 at yesterday’s closing price.

The audio video production industry is part of the consumer discretionary sector. This industry currently has a Zacks Industry Rank of 209, which places it in the bottom 18% of all 250+ industries.

The Zacks Industry Ranking assesses the strength of our individual industry groups by measuring the average Zacks Ranking of individual stocks within the groups. Our research shows that the top 50% of industries outperform the bottom half by a factor of 2 to 1.

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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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