Strength Seen in Digi Power X Inc. (DGXX): Can Its 25.7% Jump Turn into More Strength?

Digi Power X Inc. (DGXX) shares ended the last trading session 25.7% higher at $5.77. 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 97.9% gain over the past four weeks.

The stock recorded this price increase as the company benefits from rising demand from the enterprise AI and data-intensive sectors, and the fintech domain.

This company is expected to post quarterly loss of $0.11 per share in its upcoming report, which represents a year-over-year change of +35.3%. Revenues are expected to be $8.8 million, down 4.1% 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 Digi Power X Inc., 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 DGXX 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 >>>>

Digi Power X Inc. is a member of the Zacks Technology Services industry. One other stock in the same industry, BlackSky Technology Inc. (BKSY), finished the last trading session 1.4% lower at $23.32. BKSY has returned 19.9% over the past month.

For BlackSky Technology, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at -$0.37. This represents a change of +43.9% from what the company reported a year ago. BlackSky Technology 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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