ADVA OPTICAL (ADVOF) Stock Jumps 10.3%: Will It Continue to Soar?

ADVA OPTICAL (ADVOF) shares ended the last trading session 10.3% higher at $13.47. 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 1.8% gain over the past four weeks.

The increase in share price can attributed to accelerated digitalization taking place across the globe triggered by the coronavirus crisis. As a result, the company is witnessing increasing order volume from private companies, network operators and governments.

Efforts to expand its software and services’ business as well as focus on high growth markets bodes well for ADVA Optical.

Recently, the company unveiled its latest offering — FSP 3000 TeraFlex CoreChannel — that enables transmission of 800Gbit per second over huge distances for both internet content providers and communication service providers.

ADVA OPTICAL Price and Consensus

ADVA OPTICAL Price and Consensus

ADVA OPTICAL price-consensus-chart | ADVA OPTICAL Quote

This company is expected to post quarterly earnings of $0.20 per share in its upcoming report, which represents a year-over-year change of +17.7%. Revenues are expected to be $180 million, up 12.7% 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 ADVA OPTICAL, 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 ADVOF going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank 2 (Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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