AI-powered search site Elastic (ESTC) just saw an amazing leap for its IBD SmartSelect Composite Rating, as it jumped to a near-best 97 Monday, up from 69 the day before. One reason for the big rise? Elastic stock shot up nearly 15% on Friday after it reported better-than-expected earnings the day before.
The upgraded Composite score means highly ranked Elastic stock currently tops 97% of all other stocks in terms of key performance metrics and technical strength.
↑ X NOW PLAYING What Are The Magnificent Seven Stocks?Elastic combines cloud-based search capabilities with generative AI. That yields what it calls on its website "relevant results at unprecedented speed with open and flexible enterprise solutions," for enterprises.
Elastic reported higher earnings growth every quarter this past year. The young company, which launched its IPO in October 2018, rose from a 5% drop in EPS four quarters ago to rise 40%, 59% and then 75% last quarter to 63 cents per share, 16 cents higher than expected. Revenue growth in that period ranged from 17% to 20%.
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Elastic earns the No. 2 rank among its peers in the Computer Software-Database industry group. Commvault Systems (CVLT) is the top-ranked stock in the group.
Elastic stock has been in a consolidation pattern for the past year, with a buy point of 136.06. During the consolidation it dropped to a 69 low in early September. Monday afternoon it traded just above 107, down 7.4% for the day and up 55% from the September low.
for the current quarter, analysts polled by FactSet forecast a 76% rise in EPS on a 14% gain in sales as it faces tough comps from a year ago.
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Among its other ratings San Francisco-based Elastic has an 87 Relative Strength Rating, putting it in the top 13% of all stocks for price performance this past year. Its B Accumulation/Distribution Rating shows that big funds are fairly eager buyers over the last 13 weeks.
One yellow flag is the company's 78 EPS Rating, which tracks quarterly and annual earnings growth. That puts it in the top quartile for earnings. But look for that to improve to 80 or better to show it's in the top 20% of all stocks.
This article was created automatically with Stats Perform's Wordsmith software using data and article templates supplied by Investor's Business Daily. An IBD journalist may have edited the article.
Please follow James DeTar on Twitter @JimDeTar
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