In the latest trading session, Magna (MGA) closed at $96.52, marking a -1.83% move from the previous day. This change lagged the S&P 500’s daily gain of 0.18%.
Prior to today’s trading, shares of the automotive supply company had gained 1.78% over the past month. This has lagged the Auto-Tires-Trucks sector’s gain of 7.54% and the S&P 500’s gain of 2.43% in that time.
Investors will be hoping for strength from MGA as it approaches its next earnings release. On that day, MGA is projected to report earnings of $1.51 per share, which would represent year-over-year growth of 188.3%. Meanwhile, our latest consensus estimate is calling for revenue of $9.57 billion, up 122.97% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $7.51 per share and revenue of $40.96 billion, which would represent changes of +90.13% and +25.47%, respectively, from the prior year.
Any recent changes to analyst estimates for MGA should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
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. Within the past 30 days, our consensus EPS projection remained stagnant. MGA is currently sporting a Zacks Rank of #3 (Hold).
In terms of valuation, MGA is currently trading at a Forward P/E ratio of 13.09. For comparison, its industry has an average Forward P/E of 14, which means MGA is trading at a discount to the group.
Meanwhile, MGA’s PEG ratio is currently 0.75. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. Automotive – Original Equipment stocks are, on average, holding a PEG ratio of 1.02 based on yesterday’s closing prices.
The Automotive – Original Equipment industry is part of the Auto-Tires-Trucks sector. This group has a Zacks Industry Rank of 175, putting it in the bottom 32% 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.
You can find more information on all of these metrics, and much more, on Zacks.com.
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