Veeco (VECO) Soars 7.2%: Is Further Upside Left in the Stock?

Veeco Instruments VECO shares ended the last trading session 7.2% higher at $83.04. 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 32.1% gain over the past four weeks.

Veeco Instruments is benefiting from strong demand driven by the global build-out of AI infrastructure, high-performance computing, and the transition to advanced semiconductor and compound semiconductor technologies, particularly in areas like indium phosphide lasers, advanced packaging, and ion beam deposition for AI data centers.

This precision manufacturing equipment maker is expected to post quarterly earnings of $0.26 per share in its upcoming report, which represents a year-over-year change of -27.8%. Revenues are expected to be $180 million, up 8.4% 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 Veeco, 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 VECO going forward to see if this recent jump can turn into more strength down the road.

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

Veeco is a member of the Zacks Electronics - Manufacturing Machinery industry. One other stock in the same industry, Cohu COHU, finished the last trading session 4.4% higher at $64.05. COHU has returned 30.1% over the past month.

Cohu's consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.14. Compared to the company's year-ago EPS, this represents a change of +600%. Cohu currently boasts a Zacks Rank of #3 (Hold).

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

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