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Strength Seen in Lantronix, Inc. (LTRX): Can Its 11.6% Jump Turn into More Strength?

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Lantronix, Inc. (LTRX - Free Report) shares ended the last trading session 11.6% higher at $6.93. 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 5.6% gain over the past four weeks.

The increase in share price can be attributed to strong demand for the company’s solutions within the IoT System Solutions segment.  The segment’s top line performance is being driven by contributions from out-of-band deployments and shipments of telematics asset tracking solutions to a Tier 1 telecom carrier.

Going ahead, the company expects Embedded Systems’ segment to gain from higher demand for both hardware and design services from EV customers across various geographies.

For the fiscal second quarter of 2024, the company expects to report sequential increase in revenues as QED ramps into volume production. Given a relatively steady demand environment, management reaffirmed its revenue guidance for fiscal 2024.

For fiscal year 2024, the company anticipates revenue in the range of $175-$185 million and non-GAAP earnings in the range of 50-60 cents per share.

Recently, Lantronix teamed up with P3 Digital Services to build a pre-integrated hardware and software turnkey In-Vehicle Infotainment (IVI) platform. This platform will aid OEMs to accelerate time to market while lowering costs.

This company is expected to post quarterly earnings of $0.08 per share in its upcoming report, which represents a year-over-year change of +100%. Revenues are expected to be $37.2 million, up 18.1% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For Lantronix, 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 LTRX 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 >>>>

Lantronix, Inc. belongs to the Zacks Computer - Networking industry. Another stock from the same industry, Digi International (DGII - Free Report) , closed the last trading session 2.6% lower at $23.27. Over the past month, DGII has returned -3.9%.

For Digi International, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.45. This represents a change of -6.3% from what the company reported a year ago. Digi International currently has a Zacks Rank of #4 (Sell).

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