Shares of social networking company Momo (NASDAQ: MOMO) jumped on Wednesday, yet there was no news driving the stock higher. With the major stock indices up more than 1% each at 3:40 p.m. EST, Momo's surge may just be the result of the broad stock rally. Shares of Momo were up 12% at 3:40 p.m. EST.
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We last heard from Momo when it reported its third-quarter results back on Nov. 28. The company produced year-over-year revenue growth of 126%, beating analyst estimates for both revenue and earnings. Momo stock tanked despite the positive results, extending a decline that had begun a few months earlier.
Wednesday's gain undoes some of that decline, but the stock is still below where it was prior to the third-quarter report, and it remains about 39% below its 52-week high.
Momo will report its fourth-quarter results in early March, based on the company's reporting schedule from previous years. Analysts expect revenue to grow by 54% year over year, with adjusted earnings per share rising only slightly to $0.47. With the stock surging for no apparent reason on Wednesday, investors should brace for more volatility.
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