Silicon Motion SIMO shares rallied 8.7% in the last trading session to close at $42.35. 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 26.2% loss over the past four weeks.

Silicon Motion has expanded its SSD controller program engagements with PC OEMs and eMMC/UFS controllers for smartphones, automotive applications and IoT/smart devices. The company is adding to this momentum with the launch of next-generation enterprise-class SSD controllers. The company’s worldwide customer base makes it vulnerable to geopolitical volatility and trade hostiles. The U.S. Government’s recent decision to suspend higher tariffs for most countries for 90 days, except China, has raised investors’ confidence. These factors are likely to have propelled the share price appreciation.

This chip company is expected to post quarterly earnings of $0.44 per share in its upcoming report, which represents a year-over-year change of -31.3%. Revenues are expected to be $162.58 million, down 14.1% 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 Silicon Motion, 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 SIMO 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 >>>>

Silicon Motion belongs to the Zacks Computer - Integrated Systems industry. Another stock from the same industry, IBM IBM, closed the last trading session 6.5% higher at $235.31. Over the past month, IBM has returned -11.2%.

IBM's consensus EPS estimate for the upcoming report has changed -0.2% over the past month to $1.42. Compared to the company's year-ago EPS, this represents a change of -15.5%. IBM currently boasts a Zacks Rank of #3 (Hold).

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This article originally published on Zacks Investment Research (zacks.com).

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