Esab (ESAB) shares soared 5.6% in the last trading session to close at $96.72. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 3.4% gain over the past four weeks.
The company’s shares have gained since it closed the acquisition of Eddyfi Technologies earlier this month. Eddyfi is a global leader in advanced inspection and monitoring technologies.
The combination of Eddyfi’s technology expertise with ESAB’s global reach creates a comprehensive workflow solutions platform spanning fabrication, inspection and monitoring. The acquisition enhances ESAB’s portfolio, supports its transition toward a faster-growing, higher-margin and less cyclical business model, and strengthens its position as a preferred partner for customers that prioritize quality, productivity and asset integrity.
ESAB’s second-quarter results will reflect one month of Eddyfi’s financial contribution. Management is expected to provide updated full-year guidance, including the impact of the acquisition, during its second-quarter earnings call.
This maker of welding and cutting equipment is expected to post quarterly earnings of $1.45 per share in its upcoming report, which represents a year-over-year change of +6.6%. Revenues are expected to be $732.34 million, up 7.9% from the year-ago quarter.
Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.
For Esab, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on ESAB going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Esab is a member of the Zacks Metal Products - Procurement and Fabrication industry. One other stock in the same industry, Century Aluminum (CENX), finished the last trading session 10.9% lower at $54.55. CENX has returned 7.7% over the past month.
Century's consensus EPS estimate for the upcoming report has remained unchanged over the past month at $2.4. Compared to the company's year-ago EPS, this represents a change of +4900%. Century currently boasts a Zacks Rank of #3 (Hold).
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
