Advertisement
Australia markets closed
  • ALL ORDS

    8,153.70
    +80.10 (+0.99%)
     
  • ASX 200

    7,896.90
    +77.30 (+0.99%)
     
  • AUD/USD

    0.6514
    -0.0022 (-0.33%)
     
  • OIL

    82.49
    +1.14 (+1.40%)
     
  • GOLD

    2,227.40
    +14.70 (+0.66%)
     
  • Bitcoin AUD

    108,889.10
    +1,239.59 (+1.15%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • AUD/EUR

    0.6022
    -0.0008 (-0.14%)
     
  • AUD/NZD

    1.0895
    +0.0015 (+0.14%)
     
  • NZX 50

    12,105.29
    +94.63 (+0.79%)
     
  • NASDAQ

    18,289.57
    +8.72 (+0.05%)
     
  • FTSE

    7,969.99
    +38.01 (+0.48%)
     
  • Dow Jones

    39,783.87
    +23.79 (+0.06%)
     
  • DAX

    18,494.88
    +17.79 (+0.10%)
     
  • Hang Seng

    16,541.42
    +148.58 (+0.91%)
     
  • NIKKEI 225

    40,168.07
    -594.66 (-1.46%)
     

Earnings Estimates Moving Higher for Squarespace (SQSP): Time to Buy?

Investors might want to bet on Squarespace (SQSP), as earnings estimates for this company have been showing solid improvement lately. The stock has already gained solid short-term price momentum, and this trend might continue with its still improving earnings outlook.

The upward trend in estimate revisions for this a software company reflects growing optimism of analysts on its earnings prospects, which should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. This insight is at the core of our stock rating tool -- the Zacks Rank.

The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008.

For Squarespace, there has been strong agreement among the covering analysts in raising earnings estimates, which has helped push consensus estimates considerably higher for the next quarter and full year.

ADVERTISEMENT

The chart below shows the evolution of forward 12-month Zacks Consensus EPS estimate:

12 Month EPS

Current-Quarter Estimate Revisions

The company is expected to earn $0.12 per share for the current quarter, which represents a year-over-year change of -73.33%.

Over the last 30 days, the Zacks Consensus Estimate for Squarespace has increased 113.64% because four estimates have moved higher compared to no negative revisions.

Current-Year Estimate Revisions

The company is expected to earn $0.33 per share for the full year, which represents a change of +273.68% from the prior-year number.

The revisions trend for the current year also appears quite promising for Squarespace, with four estimates moving higher over the past month compared to no negative revisions. The consensus estimate has also received a boost over this time frame, increasing 114.52%.

Favorable Zacks Rank

The promising estimate revisions have helped Squarespace earn a Zacks Rank #2 (Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500.

Bottom Line

While strong estimate revisions for Squarespace have attracted decent investments and pushed the stock 11.4% higher over the past four weeks, further upside may still be left in the stock. So, you may consider adding it to your portfolio right away.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Squarespace, Inc. (SQSP) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research