VNET Group VNET shares soared 14.7% in the last trading session to close at $11.23. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 17.4% loss over the past four weeks.
VNET Group benefits from rapid growth of Artificial Intelligence, strong demand from hyperscale cloud companies alongwith expansion of data center capacity, increasing demand for High-Density Computing and strong order pipeline.
This provider of carrier-neutral internet data center services is expected to post quarterly earnings of $0.04 per share in its upcoming report, which represents a year-over-year change of +500%. Revenues are expected to be $375.72 million, up 22.1% 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 VNET Group, the consensus EPS estimate for the quarter has been revised 25% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on VNET 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 >>>>
VNET Group is a member of the Zacks Internet - Software industry. One other stock in the same industry, Kingsoft Cloud Holdings Limited Sponsored ADR KC, finished the last trading session 1.3% lower at $14.09. KC has returned 6.3% over the past month.
Kingsoft Cloud's consensus EPS estimate for the upcoming report has changed -27.3% over the past month to -$0.07. Compared to the company's year-ago EPS, this represents a change of -75%. Kingsoft Cloud currently boasts a Zacks Rank of #3 (Hold).
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VNET Group, Inc. - Unsponsored ADR (VNET): Free Stock Analysis Report
Kingsoft Cloud Holdings Limited Sponsored ADR (KC): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).