Radcom RDCM shares rallied 6.6% in the last trading session to close at $10.73. 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 5% gain over the past four weeks.

The increase in share price can attributed to the strength in demand for the company’s cloud-powered automated assurance and intelligence analytics solutions including the RADCOM ACE product line. Network operators are exploring next-generation cloud technology as they look to cut down costs amid the 5G rollout. RDCM is ramping up its efforts to boost its portfolio of assurance solutions to capitalize on this opportunity.

During the second quarter 2024 earnings call, the company announced that it had clinched over $50 million in new contracts since the beginning of the year. The majority of the revenues will be recognized in 2025 and beyond, added management.

RADCOM is also directing its efforts at embedding Generative AI technology across its product portfolio to aid operators in handling their networks more dynamically and effectively. As a part of this endeavor, RDCM announced that Radcom NetTalk, its GenAI application, was now available on Amazon Web Service in the second quarter.

The company remains focused on expanding its sales channel and has teamed up with distributors and  local agencies, principally in South America and Europe for the same.

In the last reported quarter, revenues of $14.8 million increased 20% year over year.  Higher revenues and cost discipline led to a 170% year-over-year increase in non-GAAP operating profit for the quarter.

This monitoring service for the communications industry is expected to post quarterly earnings of $0.19 per share in its upcoming report, which represents a year-over-year change of +26.7%. Revenues are expected to be $15 million, up 13.6% 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 Radcom, 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 RDCM 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 >>>>