SPS Commerce (SPSC) shares soared 5.7% in the last trading session to close at $58.87. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 4.1% gain over the past four weeks.
The stock is benefiting from reports that SPS Commerce is exploring a potential sale, following pressure from activist shareholders to evaluate strategic alternatives.
This provider of supply chain software services to businesses is expected to post quarterly earnings of $1.08 per share in its upcoming report, which represents a year-over-year change of +8%. Revenues are expected to be $195.14 million, up 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 SPS Commerce, 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 SPSC 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 >>>>
SPS Commerce is part of the Zacks Business - Services industry. Bowman Consulting (BWMN), another stock in the same industry, closed the last trading session 2.3% higher at $29.92. BWMN has returned -10.8% in the past month.
For Bowman Consulting, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.47. This represents a change of -14.6% from what the company reported a year ago. Bowman Consulting currently has a Zacks Rank of #3 (Hold).
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
