All You Need to Know About AvidXchange (AVDX) Rating Upgrade to Buy

Core Viewpoint - AvidXchange Holdings, Inc. (AVDX) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive outlook on its earnings estimates, which is a significant factor influencing stock prices [1][2]. Earnings Outlook - The Zacks Consensus Estimate for AvidXchange for the fiscal year ending December 2024 is projected at $0.22 per share, reflecting a substantial increase of 214.3% compared to the previous year [5]. - Over the past three months, the Zacks Consensus Estimate for AvidXchange has risen by 142.9%, indicating a strong upward trend in earnings estimates [5]. Impact of Earnings Estimates - Changes in a company's earnings potential, as indicated by earnings estimate revisions, are closely correlated with short-term stock price movements, particularly due to the actions of institutional investors [3]. - The Zacks rating system effectively captures the influence of earnings estimate revisions, which can lead to significant stock price movements as institutional investors adjust their valuations based on these estimates [4]. Zacks Rating System - The Zacks Rank stock-rating system categorizes stocks into five groups based on earnings estimates, with Zacks Rank 1 (Strong Buy) stocks historically generating an average annual return of +25% since 1988 [4]. - AvidXchange's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting a strong potential for price appreciation in the near term [7].