Pros Holdings (PRO) could be a solid addition to your portfolio given a notable revision in the company's earnings estimates. While the stock has been gaining lately, the trend might continue since its earnings outlook is still improving.

The upward trend in estimate revisions for this pricing and revenue-management software maker reflects growing optimism of analysts on its earnings prospects, which should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. Our stock rating tool -- the Zacks Rank -- is principally built on this insight.

The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008.

Consensus earnings estimates for the next quarter and full year have moved considerably higher for Pros Holdings, as there has been strong agreement among the covering analysts in raising estimates.

Current-Quarter Estimate Revisions

For the current quarter, the company is expected to earn $0.13 per share, which is a change of +550% from the year-ago reported number.

The Zacks Consensus Estimate for Pros Holdings has increased 60.71% over the last 30 days, as three estimates have gone higher compared to no negative revisions.

Current-Year Estimate Revisions

The company is expected to earn $0.37 per share for the full year, which represents a change of +640% from the prior-year number.

In terms of estimate revisions, the trend for the current year also appears quite encouraging for Pros Holdings. Over the past month, four estimates have moved higher compared to no negative revisions, helping the consensus estimate increase 32.56%.

Favorable Zacks Rank

Thanks to promising estimate revisions, Pros Holdings currently carries a Zacks Rank #2 (Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500.

Bottom Line

Pros Holdings shares have added 16.3% over the past four weeks, suggesting that investors are betting on its impressive estimate revisions. So, you may consider adding it to your portfolio right away to benefit from its earnings growth prospects.