Core Viewpoint - Amentum Holdings (AMTM) has been upgraded to a Zacks Rank 2 (Buy) due to an upward trend in earnings estimates, which is a significant factor influencing stock prices [1][2]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on changes in a company's earnings picture, which is crucial for predicting near-term stock price movements [2][3]. - There is a strong correlation between earnings estimate revisions and stock price movements, with institutional investors using these estimates to determine fair value [3]. Business Improvement Indicators - The rising earnings estimates and the Zacks rating upgrade for Amentum suggest an improvement in the company's underlying business, which could lead to higher stock prices [4]. Importance of Earnings Estimate Revisions - Tracking earnings estimate revisions is essential for making investment decisions, and the Zacks Rank system effectively utilizes this information [5][6]. - The Zacks Rank system has a proven track record, with Zacks Rank 1 stocks averaging an annual return of +25% since 1988 [6]. Specifics on Amentum's Earnings Estimates - For the fiscal year ending September 2025, Amentum is expected to earn $2.14 per share, unchanged from the previous year, but the Zacks Consensus Estimate has increased by 1.2% over the past three months [7]. Zacks Rating System Overview - The Zacks rating system maintains a balanced distribution of "buy" and "sell" ratings across over 4,000 stocks, with only the top 20% receiving favorable ratings [8][9]. - Amentum's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, indicating strong potential for market-beating returns in the near term [9].
What Makes Amentum (AMTM) a New Buy Stock