Strength Seen in VNET Group (VNET): Can Its 7.3% Jump Turn into More Strength?

VNET Group VNET shares soared 7.3% in the last trading session to close at $11.13. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 33% gain over the past four weeks.

VNET is benefiting from strong AI-driven demand and rapid growth in its wholesale IDC business.

This provider of carrier-neutral internet data center services is expected to post quarterly earnings of $0.03 per share in its upcoming report, which represents a year-over-year change of -50%. Revenues are expected to be $331.52 million, up 9.7% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For VNET Group, 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 VNET going forward to see if this recent jump can turn into more strength down the road.

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 >>>>

VNET Group is part of the Zacks Internet - Software industry. NCR Atleos NATL, another stock in the same industry, closed the last trading session 1.8% lower at $38.61. NATL has returned -2.5% in the past month.

For NCR Atleos, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $1.01. This represents a change of +13.5% from what the company reported a year ago. NCR Atleos currently has a Zacks Rank of #1 (Strong Buy).

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

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