SMART Global Holdings, Inc. (SGH Quick QuoteSGH - Free Report) shares rallied 17.8% in the last trading session to close at $56.02. 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 2% gain over the past four weeks.

Smart Global Holdings extended its rally, driven by an upward revision in its price target from $65 to $75 done by Needham & Company’s analyst Rajvindra Gill. This is primarily attributed to the company’s better than expected third-quarter fiscal 2021 results. Moreover, Smart Global has provided positive outlook for fourth-quarter fiscal 2021 earnings per share and sales. This is likely to aid the stock in gaining investors’ optimism further.

This company is expected to post quarterly earnings of $1.22 per share in its upcoming report, which represents a year-over-year change of +48.8%. Revenues are expected to be $440.8 million, up 48.4% 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 SMART Global Holdings, Inc., 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 SGH 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 >>>>