Sallie Mae (SLM) Gains But Lags Market: What You Should Know

Sallie Mae (SLM) closed the most recent trading day at $9.54, moving +1.92% from the previous trading session. This change lagged the S&P 500's 4.94% gain on the day. Meanwhile, the Dow gained 4.89%, and the Nasdaq, a tech-heavy index, added 4.95%.

Coming into today, shares of the student loan company had lost 19.31% in the past month. In that same time, the Finance sector lost 20.8%, while the S&P 500 lost 17.66%.

SLM will be looking to display strength as it nears its next earnings release. On that day, SLM is projected to report earnings of $0.85 per share, which would represent year-over-year growth of 150%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $397.76 million, down 1.12% from the year-ago period.

SLM's full-year Zacks Consensus Estimates are calling for earnings of $1.88 per share and revenue of $1.58 billion. These results would represent year-over-year changes of +48.03% and -2.55%, respectively.

Investors might also notice recent changes to analyst estimates for SLM. 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.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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, 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. Over the past month, the Zacks Consensus EPS estimate remained stagnant. SLM is holding a Zacks Rank of #1 (Strong Buy) right now.

In terms of valuation, SLM is currently trading at a Forward P/E ratio of 4.98. For comparison, its industry has an average Forward P/E of 5.86, which means SLM is trading at a discount to the group.

Meanwhile, SLM's PEG ratio is currently 0.45. 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. SLM's industry had an average PEG ratio of 0.47 as of yesterday's close.

The Financial - Consumer Loans industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 78, which puts it in the top 31% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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.

To follow SLM in the coming trading sessions, be sure to utilize Zacks.com.