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Petrobras (PBR) Dips More Than Broader Markets: What You Should Know

This story originally appeared on Zacks

In the latest trading session, Petrobras (PBR) closed at $10.18, marking a -1.26% move from the previous day. This change lagged the S&P 500’s 0.58% loss on the day.

Heading into today, shares of the oil and gas company had lost 7.53% over the past month, lagging the Oils-Energy sector’s gain of 1.56% and the S&P 500’s gain of 0.16% in that time.

PBR will be looking to display strength as it nears its next earnings release. On that day, PBR is projected to report earnings of $0.61 per share, which would represent year-over-year growth of 577.78%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $22.25 billion, up 69.21% from the year-ago period.

PBR’s full-year Zacks Consensus Estimates are calling for earnings of $2.33 per share and revenue of $79.71 billion. These results would represent year-over-year changes of +441.86% and +48.48%, respectively.

Any recent changes to analyst estimates for PBR 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. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 8.02% higher. PBR is currently a Zacks Rank #1 (Strong Buy).

In terms of valuation, PBR is currently trading at a Forward P/E ratio of 4.42. Its industry sports an average Forward P/E of 5.66, so we one might conclude that PBR is trading at a discount comparatively.

Meanwhile, PBR’s PEG ratio is currently 0.21. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. Oil and Gas – Integrated – Emerging Markets stocks are, on average, holding a PEG ratio of 0.21 based on yesterday’s closing prices.

The Oil and Gas – Integrated – Emerging Markets industry is part of the Oils-Energy sector. This industry currently has a Zacks Industry Rank of 9, which puts it in the top 4% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our 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.

You can find more information on all of these metrics, and much more, on Zacks.com.

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