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Sonos (SONO) Outpaces Stock Market Gains: What You Should Know

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Sonos (SONO) closed at $32.81 in the latest trading session, marking a +1.96% move from the prior day. This change outpaced the S&P 500's 0.37% gain on the day.

Prior to today's trading, shares of the maker of wireless speakers and home sound systems had lost 12.34% over the past month. This has lagged the Consumer Discretionary sector's loss of 1.97% and the S&P 500's gain of 2.13% in that time.

Wall Street will be looking for positivity from SONO as it approaches its next earnings report date. On that day, SONO is projected to report earnings of -$0.07 per share, which would represent a year-over-year decline of 146.67%. Meanwhile, our latest consensus estimate is calling for revenue of $351.56 million, up 3.45% from the prior-year quarter.

Any recent changes to analyst estimates for SONO should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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 0.79% higher. SONO is currently a Zacks Rank #1 (Strong Buy).

Looking at its valuation, SONO is holding a Forward P/E ratio of 27.5. Its industry sports an average Forward P/E of 13.4, so we one might conclude that SONO is trading at a premium comparatively.

We can also see that SONO currently has a PEG ratio of 0.66. 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. Audio Video Production stocks are, on average, holding a PEG ratio of 1.16 based on yesterday's closing prices.

The Audio Video Production industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 24, putting it in the top 10% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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