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SM Energy (SM) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research
·2 min read

In the latest trading session, SM Energy (SM) closed at $34.82, marking a +1.55% move from the previous day. This change outpaced the S&P 500's 0.28% gain on the day. Elsewhere, the Dow gained 0.11%, while the tech-heavy Nasdaq added 0.14%.

Heading into today, shares of the independent oil and gas company had gained 17.35% over the past month, outpacing the Oils-Energy sector's gain of 7.1% and the S&P 500's gain of 0.12% in that time.

Investors will be hoping for strength from SM Energy as it approaches its next earnings release. The company is expected to report EPS of $0.81, up 3950% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $582.89 million, up 81.99% from the year-ago period.

It is also important to note the recent changes to analyst estimates for SM Energy. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

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Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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.

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. The Zacks Consensus EPS estimate has moved 7.55% higher within the past month. SM Energy is currently a Zacks Rank #3 (Hold).

In terms of valuation, SM Energy is currently trading at a Forward P/E ratio of 6.14. Its industry sports an average Forward P/E of 6.12, so we one might conclude that SM Energy is trading at a premium comparatively.

The Oil and Gas - Exploration and Production - United States industry is part of the Oils-Energy sector. This group has a Zacks Industry Rank of 211, putting it in the bottom 18% 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.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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