NCS Multistage (NCSM) Soars 15.0%: Is Further Upside Left in the Stock?

NCS Multistage (NCSM) shares rallied 15% in the last trading session to close at $85.2. 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 2.2% gain over the past four weeks.

The surge can be attributed to NCS Multistage Holdings’ strong foothold in key well construction and completion technologies, along with elevated crude prices crossing $90 per barrel amid geopolitical tensions in the Middle East. NCS Multistage supports exploration and production firms with products and services used in both onshore and offshore wells spanning conventional and unconventional reservoirs. NCSM has operations spread across the globe including North America, Middle East & Asia, Europe/CIS/Africa and Latin America. As demand for oil and energy continues to rise, NCSM is expected to see stronger demand for its equipment and services, driving revenue growth. The company’s strong global foothold as an oil and gas equipment and service provider, coupled with rising demand for oil and cleaner energy, has been a significant revenue driver.

This company is expected to post quarterly earnings of $1.33 per share in its upcoming report, which represents a year-over-year change of -11.9%. Revenues are expected to be $51.22 million, up 2.4% 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 NCS Multistage, 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 NCSM going forward to see if this recent jump can turn into more strength down the road.

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

NCS Multistage is a member of the Zacks Oil and Gas - Field Services industry. One other stock in the same industry, Drilling Tools International Corp. (DTI), finished the last trading session 2.2% higher at $3.24. DTI has returned -14.3% over the past month.

For Drilling Tools International Corp., the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.01. This represents a change of -50% from what the company reported a year ago. Drilling Tools International Corp. currently has a Zacks Rank of #1 (Strong Buy).

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This article originally published on Zacks Investment Research (zacks.com).

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