Ooma (OOMA) shares soared 6.4% in the last trading session to close at $7.51. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock’s 14.7% loss over the past four weeks.
Ooma’s focus on small business customers with simple, easy-to-use interfaces that can be implemented quickly without IT support for an integrated business connectivity solution is likely to drive healthy growth momentum. Its low-cost fixed line that reportedly offers faster emergency access services is expected to gain traction, while increased penetration within enterprise markets with customized offerings is likely to have buoyed the share prices.
This internet phone service provider is expected to post quarterly earnings of $0.12 per share in its upcoming report, which represents a year-over-year change of -25%. Revenues are expected to be $61.85 million, up 8.8% 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 Ooma, 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 OOMA 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 >>>>
Ooma is part of the Zacks Communication – Components industry. Airgain (AIRG), another stock in the same industry, closed the last trading session 0.8% lower at $5.20. AIRG has returned -3.3% in the past month.
Airgain’s consensus EPS estimate for the upcoming report has remained unchanged over the past month at -$0.08. Compared to the company’s year-ago EPS, this represents no change. Airgain currently boasts a Zacks Rank of #2 (Buy).
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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.
