A History of Outperforming Analyst Forecasts and Beating the Odds: Hello Group Inc. (MOMO)

Hello Group Inc. (NASDAQ: MOMO) stock fell -0.10% on Monday to $10.28 against a previous-day closing price of $10.29. With 1.81 million shares changed hands, the volume of the stock remained lighter than its average volume of 3.32 million shares. During the session, the Internet Content & Information company that operates in wider Communication Services sector, reached to the highest price of $10.46 whereas the lowest price it dropped to was $9.97. The 52-week range on MOMO shows that it touched its highest point at $10.97 and its lowest point at $3.96 during that stretch. It currently has a 1-year price target of $9.44. Beta for the stock currently stands at 0.80.

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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 MOMO was down-trending over the past week, with a drop of -3.47%, but this was up by 23.71% over a month. Three-month performance surged to 135.24% while six-month performance rose 128.44%. The stock gained 23.04% in the past year, while it has gained 14.48% so far this year. A look at the trailing 12-month EPS for MOMO yields -2.42 with Next year EPS estimates of 1.38. For the next quarter, that number is 0.29. This implies an EPS growth rate of -254.70% for this year and 6.20% for next year. EPS is expected to grow by 4.22% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of -13.66%.

Float and Shares Shorts:

At present, 195.51 million MOMO shares are outstanding with a float of 144.04 million shares on hand for trading. On Oct 13, 2022, short shares totaled 7.62 million, which was 3.85% higher than short shares on Sep 14, 2022. In addition to Mr. Yan Tang as the firm’s Exec. Chairman, Mr. Li Wang serves as its CEO & Director.

Institutional Ownership:

Through their ownership of 68.88% of MOMO’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 44.03% of MOMO, in contrast to 24.96% held by mutual funds. Shares owned by individuals account for –. As the largest shareholder in MOMO with 6.63% of the stake, Renaissance Technologies LLC holds 10,111,698 shares worth 10,111,698. A second-largest stockholder of MOMO, Invesco Asset Management Ltd., holds 9,033,656 shares, controlling over 5.93% of the firm’s shares. Alibaba Group Holding Ltd. is the third largest shareholder in MOMO, holding 8,434,570 shares or 5.53% stake. With a 5.90% stake in MOMO, the Invesco Funds – Global Consumer T is the largest stakeholder. A total of 8,988,656 shares are owned by the mutual fund manager. The R Valor, which owns about 2.14% of MOMO stock, is the second-largest Mutual Fund holder. It holds 3,261,964 shares valued at 29.29 million. Vanguard Emerging Markets Stock I holds 1.34% of the stake in MOMO, owning 2,045,724 shares worth 18.37 million.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for MOMO since 13 analysts follow the stock currently. There are 9 analysts who recommend BUY ratings, while 0 suggest SELL ratings. Of the remaining analysts, 4 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 MOMO analysts setting a high price target of $139.47 and a low target of $48.82, the average target price over the next 12 months is $70.56. Based on these targets, MOMO could surge 1256.71% to reach the target high and rise by 374.9% to reach the target low. Reaching the average price target will result in a growth of 586.38% 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. MOMO will report FY 2022 earnings on 03/21/2024. Analysts have provided yearly estimates in a range of $8.98 being high and $6.73 being low. For MOMO, this leads to a yearly average estimate of $7.68. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Hello Group Inc. surprised analysts by $0.04 when it reported $0.32 EPS against a consensus estimate of $0.28. The surprise factor in the prior quarter was $0.01. Based on analyst estimates, the high estimate for the next quarter is $2.00 and the low estimate is $1.70. The average estimate for the next quarter is thus $1.87.

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