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Aspen Technology (AZPN) Stock Jumps 4.5%: Will It Continue to Soar?

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Aspen Technology (AZPN - Free Report) shares ended the last trading session 4.5% higher at $146.14. 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 0.8% loss over the past four weeks.

The increase in share price can be attributed to the improving spending environment. The company is well-poised to gain from its diversified product portfolio especially its asset optimization and management software solutions and Asset Performance Management (or “APM”) suite.

Driven by strong performance in the first half of the year and improving demand trends in several business areas, Aspen Technology raised the outlook for fiscal 2022. For fiscal 2022, Aspen Technology expects revenues in the range of $737-$754 million compared with the earlier guidance of $702-$737 million.

More importantly, Aspen Technology's merger with Emerson’s OSI Inc and the Geological Simulation Software business is driving investor optimism. In the last reported quarter, the company noted that it was on track to complete the integration in the fourth quarter of fiscal 2022.

In October 2021, Aspen Technology and Emerson inked an agreement. Per the terms, Aspen will be integrated with Emerson’s OSI Inc and the Geological Simulation Software business to form a new company.

This software maker is expected to post quarterly earnings of $1.36 per share in its upcoming report, which represents a year-over-year change of +29.5%. Revenues are expected to be $193.32 million, up 18.8% 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 Aspen Technology, 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 AZPN 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 >>>>

Aspen Technology belongs to the Zacks Computer - Software industry. Another stock from the same industry, SS&C Technologies (SSNC - Free Report) , closed the last trading session 0.6% higher at $78.91. Over the past month, SSNC has returned 5%.

SS&C Technologies' consensus EPS estimate for the upcoming report has remained unchanged over the past month at $1.25. Compared to the company's year-ago EPS, this represents a change of +5.9%. SS&C Technologies currently boasts a Zacks Rank of #3 (Hold).

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