Strength Seen in Amneal (AMRX): Can Its 12.0% Jump Turn into More Strength?

Amneal Pharmaceuticals (AMRX) shares rallied 12% in the last trading session to close at $6.05. 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 7.7% loss over the past four weeks.

The sudden soaring of the stock was observed after Amneal announced the commercial launch of over-the-counter (OTC) Naloxone Hydrochloride (Naloxone HCI) Nasal Spray, USP, 4mg in the United States, following its FDA approval, to help treat opioid overdose. Naloxone HCI is a generic equivalent to Emergent BioSolutions’ OTC opioid overdose medication, Narcan HCI Nasal Spray. The launch of Naloxone HCI provides an affordable alternative to drug overdose victims which can be bought without a prescription.  

This pharmaceutical company is expected to post quarterly earnings of $0.09 per share in its upcoming report, which represents a year-over-year change of -25%. Revenues are expected to be $621.86 million, up 11.5% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For Amneal, 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 AMRX 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 >>>>

Amneal is a member of the Zacks Medical - Drugs industry. One other stock in the same industry, Verrica Pharmaceuticals Inc. (VRCA), finished the last trading session 0.9% lower at $6.79. VRCA has returned 28.8% over the past month.

Verrica Pharmaceuticals' consensus EPS estimate for the upcoming report has remained unchanged over the past month at -$0.54. Compared to the company's year-ago EPS, this represents a change of -315.4%. Verrica Pharmaceuticals currently boasts a Zacks Rank of #4 (Sell).

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AMNEAL PHARMACEUTICALS, INC. (AMRX) : Free Stock Analysis Report

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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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