All You Need to Know About QuantumScape (QS) Rating Upgrade to Buy

Core Viewpoint - QuantumScape Corporation (QS) has received an upgrade to a Zacks Rank 2 (Buy), indicating a positive trend in earnings estimates which is a significant factor influencing stock prices [1][2]. Earnings Estimates and Stock Price Movement - The Zacks rating system highlights the strong correlation between changes in earnings estimates and near-term stock price movements, making it a valuable tool for investors [2][3]. - Institutional investors utilize earnings estimates to determine the fair value of stocks, and changes in these estimates can lead to significant stock price movements due to large transactions [3]. Business Improvement Indicators - The upgrade in QuantumScape's rating suggests an improvement in the company's underlying business, which is expected to be reflected in higher stock prices as investors respond positively [4]. Earnings Estimate Revisions - For the fiscal year ending December 2025, QuantumScape is projected to earn -$0.74 per share, which remains unchanged from the previous year. However, the Zacks Consensus Estimate has increased by 6.8% over the past three months, indicating a positive trend in earnings expectations [7]. Zacks Rank System Overview - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with a proven track record of Zacks Rank 1 stocks generating an average annual return of +25% since 1988 [6]. - The upgrade of QuantumScape to a Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting a strong potential for market-beating returns in the near term [9].