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Netlist, Inc. (OTC:NLST) shares rallied 19.6% in the last trading session to close at $7.50. 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 0.3% gain over the past four weeks.
The increase in share price can be attributed to favorable verdict received by Netlist from Federal District Court against Korean giant Samsung (KS:005930) regarding the lawsuit pertaining to the Joint Development and License Agreement (“JDLA”).
The Federal Court added that Samsung does no longer have a “valid license” to Netlist's patent portfolio and that Netlist correctly terminated the contract, added the company. JDLA was executed by the two companies in November 2015
Damages associated with the breach of contract will be decided by the jury when the trial begins on Nov 30, 2021.
This company is expected to post quarterly loss of $0.01 per share in its upcoming report, which represents no change from the year-ago quarter. Revenues are expected to be $29 million, up 184% 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 Netlist, Inc., 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 NLST 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 >>>>
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