Relay Therapeutics, Inc. (RLAY) Moves 10.0% Higher: Will This Strength Last?

Relay Therapeutics, Inc. (RLAY) shares rallied 10% in the last trading session to close at $9.89. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 17.2% loss over the past four weeks.

The sudden surge in the stock price can be attributed to positive investor mindset regarding the company's pipeline progress. Relay Therapeutics is leveraging its Dynamo platform to initially focus on precision oncology. The company has several candidates currently undergoing early stage development for various cancer indications. 

This company is expected to post quarterly loss of $0.71 per share in its upcoming report, which represents a year-over-year change of -26.8%. Revenues are expected to be $1.45 million, up 480% 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 Relay Therapeutics, Inc., the consensus EPS estimate for the quarter has been revised 2.5% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on RLAY going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Relay Therapeutics, Inc. belongs to the Zacks Medical - Drugs industry. Another stock from the same industry, Verve Therapeutics (VERV), closed the last trading session 4.6% higher at $12.75. Over the past month, VERV has returned -2.8%.

Verve Therapeutics' consensus EPS estimate for the upcoming report has remained unchanged over the past month at -$0.80. Compared to the company's year-ago EPS, this represents a change of -19.4%. Verve Therapeutics currently boasts a Zacks Rank of #4 (Sell).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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