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Cerence (CRNC) Soars 8.7%: Is Further Upside Left in the Stock?

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Cerence (CRNC - Free Report) shares rallied 8.7% in the last trading session to close at $35.09. 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 27.1% gain over the past four weeks.

The upswing in Cerence’s share price can be attributed to its expanding clientele. Cerence Ride was recently selected by Chinese OEM Loncin Motors for its high-end motorcycle line to enable AI-powered voice interaction for riders. Cerence JustTalk is also getting integrated into MBUX, Mercedes-Benz AG’s intuitive multimedia system for the new Mercedes-Benz E-Class.

This automotive artificial intelligence developer is expected to post quarterly loss of $0.17 per share in its upcoming report, which represents a year-over-year change of -139.5%. Revenues are expected to be $60.83 million, down 31.7% 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 Cerence, 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 CRNC going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Cerence is a member of the Zacks Computers - IT Services industry. One other stock in the same industry, (WIX - Free Report) , finished the last trading session 4.6% lower at $85.02. WIX has returned 10.5% over the past month.'s consensus EPS estimate for the upcoming report has changed +48.2% over the past month to $0.52. Compared to the company's year-ago EPS, this represents a change of +471.4%. currently boasts a Zacks Rank of #2 (Buy).

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