Qualcomm QCOM shares soared 15.2% in the last trading session to close at $143.59. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 18.6% loss over the past four weeks.

Strength in the automotive platform and higher demand for handsets, along with normalization of channel inventory within the IoT business, are major growth drivers for Qualcomm. The company recently acquired MovianAI, the former generative AI division of VinAI. The company has recently inked an agreement to acquire Edge Impulse Inc. This leading AI platform provider enables developers to create, deploy and monitor AI models for various edge devices. QCOM intends to be the driving force of the next wave of AI innovation. It is steadily expanding its AI capabilities with continuous innovation and strategic buyouts. Such initiatives will better position the company to take on its competitors in the smartphone and PC markets. 

Qualcomm has significant international operations and derives a major portion of its revenues from China. The U.S. Government recently announced its decision to suspend higher tariffs for 90 days for most countries except China. However, owing to its dependence on China, Qualcomm may not be out of the woods yet, but the relaxation of tariffs is still considered a positive development. These factors are likely to have propelled the share price appreciation.

This chipmaker is expected to post quarterly earnings of $2.79 per share in its upcoming report, which represents a year-over-year change of +14.3%. Revenues are expected to be $10.6 billion, up 12.9% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For Qualcomm, the consensus EPS estimate for the quarter has been revised marginally lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on QCOM going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Qualcomm is part of the Zacks Electronics - Semiconductors industry. Cirrus Logic CRUS, another stock in the same industry, closed the last trading session 16.5% higher at $90.23. CRUS has returned -23.9% in the past month.

For Cirrus Logic , the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $1.15. This represents a change of -7.3% from what the company reported a year ago. Cirrus Logic currently has a Zacks Rank of #2 (Buy).

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

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