Have you been paying attention to shares of Amber Road ? Shares have been on the move with the stock up 35.8% over the past month. The stock hit a new 52-week high of $13.03 in the previous session. Amber Road has gained 58% since the start of the year compared to the 13.5% move for the Zacks Computer and Technology sector and the 27.8% return for the Zacks Internet - Software industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on May 9, 2019, Amber Road reported EPS of $-0.01 versus consensus estimate of $-0.02 while it beat the consensus revenue estimate by 3.93%.
For the current fiscal year, Amber Road is expected to post earnings of $-0.03 per share on $89.5 million in revenues. This represents a 40% change in EPS on a 5.09% change in revenues. For the next fiscal year, the company is expected to earn $0.08 per share on $95.4 million in revenues. This represents a year-over-year change of 366.67% and 6.59%, respectively.
Amber Road may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
Amber Road has a Value Score of D. The stock's Growth and Momentum Scores are A and B, respectively, giving the company a VGM Score of B.
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Amber Road currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Amber Road passes the test. Thus, it seems as though Amber Road shares could have a bit more room to run in the near term.