It is Poised to be a Bull Market for Edgio Inc. (EGIO)

Edgio Inc. (NASDAQ: EGIO) stock jumped 2.80% on Wednesday to $1.47 against a previous-day closing price of $1.43. With 1.24 million shares changed hands, the volume of the stock remained heavier than its average volume of 1.11 million shares. During the session, the Software – Infrastructure company that operates in wider Technology sector, reached to the highest price of $1.5150 whereas the lowest price it dropped to was $1.4000. The 52-week range on EGIO shows that it touched its highest point at $5.55 and its lowest point at $0.79 during that stretch. It currently has a 1-year price target of $3.45. Beta for the stock currently stands at 0.86.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of EGIO was up-trending over the past week, with a rise of 14.84%, but this was down by -50.67% over a month. Three-month performance dropped to -61.82% while six-month performance fell -57.27%. The stock lost -49.83% in the past year, while it has lost -57.14% so far this year. A look at the trailing 12-month EPS for EGIO yields -0.48 with Next year EPS estimates of -0.18. For the next quarter, that number is -0.10. This implies an EPS growth rate of -169.40% for this year and -20.00% for next year. EPS is expected to grow by 15.00% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of 9.60%.

Float and Shares Shorts:

At present, 220.19 million EGIO shares are outstanding with a float of 218.11 million shares on hand for trading. On Oct 30, 2022, short shares totaled 2.81 million, which was 1.28% higher than short shares on Sep 29, 2022. In addition to Mr. Robert A. Lyons as the firm’s Pres, CEO & Director, Mr. Ajay Kapur serves as its Chief Technology Officer.

Institutional Ownership:

Through their ownership of 73.06% of EGIO’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 27.80% of EGIO, in contrast to 19.99% held by mutual funds. Shares owned by individuals account for 16.84%. As the largest shareholder in EGIO with 4.18% of the stake, Granahan Investment Management, L holds 9,185,946 shares worth 9,185,946. A second-largest stockholder of EGIO, BlackRock Fund Advisors, holds 8,065,571 shares, controlling over 3.67% of the firm’s shares. Newton Investment Management Nort is the third largest shareholder in EGIO, holding 7,119,242 shares or 3.24% stake. With a 1.65% stake in EGIO, the Vanguard Total Stock Market Index is the largest stakeholder. A total of 3,619,157 shares are owned by the mutual fund manager. The iShares Russell 2000 ETF, which owns about 1.36% of EGIO stock, is the second-largest Mutual Fund holder. It holds 2,992,005 shares valued at 8.05 million. Defiance Next Gen Connectivity ET holds 1.13% of the stake in EGIO, owning 2,475,512 shares worth 6.66 million.

An Overview of Recent Financials:

Understanding a company as a customer does not mean you will understand it as an investor. The wise investor uses quantitative research to analyze metrics such as revenue, net income, and earnings. In its fiscal quarter reported on Sep 29, 2022, EGIO reported revenue of $74.31M and operating income of -$15.05M. The EBITDA in the recently reported quarter was -$8.76M and diluted EPS was -$0.11.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for EGIO since 8 analysts follow the stock currently. There are 5 analysts who recommend BUY ratings, while 0 suggest SELL ratings. Of the remaining analysts, 3 believe that the stock is worth HOLDING, 0 give it an OVERWEIGHT rating, and 0 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With EGIO analysts setting a high price target of $6.00 and a low target of $1.70, the average target price over the next 12 months is $3.81. Based on these targets, EGIO could surge 308.16% to reach the target high and rise by 15.65% to reach the target low. Reaching the average price target will result in a growth of 159.18% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. EGIO will report FY 2022 earnings on 02/08/2023. Analysts have provided yearly estimates in a range of -$0.13 being high and -$0.17 being low. For EGIO, this leads to a yearly average estimate of -$0.15. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Edgio Inc. surprised analysts by -$0.03 when it reported -$0.08 EPS against a consensus estimate of -$0.05. The surprise factor in the prior quarter was $0.10. Based on analyst estimates, the high estimate for the next quarter is -$0.08 and the low estimate is -$0.12. The average estimate for the next quarter is thus -$0.10.

Summary of Insider Activity:

Insiders traded EGIO stock several times over the past three months with 1 Buys and 4 Sells. In these transactions, 58,628 shares were bought while 292,813 shares were sold. The number of buy transactions has increased to 23 while that of sell transactions has risen to 33 over the past year. The total number of shares bought during that period was 2,228,906 while 529,414 shares were sold.

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