Allegro MicroSystems, Inc. ALGM shares rallied 10.8% in the last trading session to close at $31.53. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 1% loss over the past four weeks.
The optimism surrounding the stock can be attributed to strong growth in automotive and data center revenues due to traction in AI-led server architectures and e-mobility solutions, respectively.
This company is expected to post quarterly earnings of $0.14 per share in its upcoming report, which represents a year-over-year change of +100%. Revenues are expected to be $224.41 million, up 26.2% 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 Allegro MicroSystems, 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 ALGM 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 >>>>
Allegro MicroSystems belongs to the Zacks Electronics - Semiconductors industry. Another stock from the same industry, Nova Ltd. NVMI, closed the last trading session 2.2% higher at $391.31. Over the past month, NVMI has returned 15%.
For Nova Ltd., the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $2.13. This represents a change of +9.8% from what the company reported a year ago. Nova Ltd. currently has a Zacks Rank of #4 (Sell).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Allegro MicroSystems, Inc. (ALGM): Free Stock Analysis Report Nova Ltd. (NVMI): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
