SentinelOne (S) Moves 9.8% Higher: Will This Strength Last?

SentinelOne (S) shares ended the last trading session 9.8% higher at $19.78. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 3.7% gain over the past four weeks.

The stock surged following reports that SentinelOne could be a potential acquisition target for Palo Alto Networks.

This cybersecurity provider is expected to post quarterly earnings of $0.03 per share in its upcoming report, which represents a year-over-year change of +200%. Revenues are expected to be $242.02 million, up 21.7% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For SentinelOne, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on S going forward to see if this recent jump can turn into more strength down the road.

The stock surged following reports that SentinelOne could be a potential acquisition target for Palo Alto Networks.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

SentinelOne is part of the Zacks Security industry. Qualys (QLYS), another stock in the same industry, closed the last trading session 0.1% higher at $139.51. QLYS has returned 2.6% in the past month.

For Qualys, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $1.47. This represents a change of -3.3% from what the company reported a year ago. Qualys currently has a Zacks Rank of #3 (Hold).

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This article originally published on Zacks Investment Research (zacks.com).

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