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Cornerstone OnDemand (CSOD) Soars 6.5%: Is Further Upside Left in the Stock?

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Cornerstone OnDemand shares soared 6.5% in the last trading session to close at $46.80. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 2.6% gain over the past four weeks.

Cornerstone OnDemand is benefiting from the acquisition of Saba Software, which has expanded its reach to more than 6,000 customers of all sizes across 180 countries and nearly 50 languages. Moreover, growing subscription revenues driven by new business wins and customers is a key catalyst.


Price and Consensus

Price Consensus Chart for CSOD


This developer of human-resources software is expected to post quarterly earnings of $0.53 per share in its upcoming report, which represents a year-over-year change of +32.5%. Revenues are expected to be $209.62 million, up 13.7% 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 Cornerstone OnDemand, 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 CSOD 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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