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Perion Network (PERI) Surges 19%: Is This an Indication of Further Gains?

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Perion Network (PERI - Free Report) shares rallied 19% in the last trading session to close at $25.69. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 36.7% gain over the past four weeks.

The increase in share price can be attributed to Perion’s upwardly revised guidance for 2021 that reflects a strong start to the year. The company now expects revenues between $370 million and $380 million, better than the previous guidance’s $350-$370 million range. Moreover, adjusted EBITDA is expected between $37 million and $38 million, up from the previous guidance of $35-$37 million.

Moreover, for the first quarter of 2021, Perion expects revenues in the $86-$87 million range, reflecting a 31% year-over-year growth. Adjusted EBITDA is expected to be at least $7.2 million compared with the year-ago quarter’s $6.2 million.

Price and Consensus

Price Consensus Chart for Perion Network

This digital media company is expected to post break-even quarterly earnings per share in its upcoming report, which represents a year-over-year change of -100%. Revenues are expected to be $76.63 million, up 16% 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 Perion Network, the consensus EPS estimate for the quarter has been revised 91.7% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on PERI 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 >>>>

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