Udemy (UDMY) Upgraded to Strong Buy: Here's Why

Core Viewpoint - Udemy, Inc. has been upgraded to a Zacks Rank 1 (Strong Buy), indicating a positive outlook on its earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Performance - The Zacks rating system emphasizes the correlation between changes in earnings estimates and stock price movements, particularly influenced by institutional investors [4][6]. - For Udemy, the recent increase in earnings estimates suggests an improvement in the company's underlying business, likely leading to a rise in stock price [5][10]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [7]. - The upgrade of Udemy to Zacks Rank 1 places it in the top 5% of Zacks-covered stocks, indicating strong potential for market-beating returns in the near term [9][10]. Earnings Estimate Revisions - Analysts have raised their earnings estimates for Udemy significantly, with the Zacks Consensus Estimate increasing by 97% over the past three months [8]. - The expected earnings per share for Udemy for the fiscal year ending December 2025 is projected to be $0.47, showing no year-over-year change [8].