Strength Seen in Progress Software (PRGS): Can Its 10.7% Jump Turn into More Strength?

Progress Software (PRGS) shares ended the last trading session 10.7% higher at $40.33. 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 14.8% loss over the past four weeks.

The increase in share price can be attributed to solid quarterly results driven by recurring revenue from its subscription model and high-margin infrastructure software. Margin expansion from cost discipline and integration synergies, AI and data infrastructure tailwinds, which are increasing demand for application development, data connectivity, and DevOps tools and defensive software appeal as PRGS operates in mission-critical, sticky products with low churn and strong cash flow.

During fiscal year 2025, the company completed the integration of the largest deal and most significant acquisition, ShareFile, which helped the company to meet every goal ahead of schedule. The company also acquired and integrated Nuclia’s agentic RAG technology, whose feedback is extremely well-received from the clients’ point of view, and has added value to PRGS’ portfolio.

This business software maker is expected to post quarterly earnings of $1.57 per share in its upcoming report, which represents a year-over-year change of +19.9%. Revenues are expected to be $245.51 million, up 3.2% 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 Progress Software, the consensus EPS estimate for the quarter has been revised 0.9% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on PRGS 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 >>>>

Progress Software is a member of the Zacks Computer - Software industry. One other stock in the same industry, ACI Worldwide (ACIW), finished the last trading session 0.3% higher at $40.88. ACIW has returned -6.8% over the past month.

For ACI Worldwide, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $1.05. This represents a change of -2.8% from what the company reported a year ago. ACI Worldwide currently has a Zacks Rank of #4 (Sell).

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

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