Strata Critical Medical, Inc. (SRTA) Surges 8.5%: Is This an Indication of Further Gains?

Strata Critical Medical, Inc. SRTA shares ended the last trading session 8.5% higher at $5.89. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 4% gain over the past four weeks.

Strata Critical Medical scored a strong price increase on investors’ optimism surrounding the company’s acquisition of Louisville Perfusion Services, Inc. (“LPS”), a regional provider of perfusion and blood management services to cardiac surgery programs in Kentucky. The all-cash transaction consists of approximately $16 million upfront consideration and up to $4 million additional consideration based on the financial performance of LPS in the 12 months following the transaction close. 

This company is expected to post quarterly loss of $0.04 per share in its upcoming report, which represents a year-over-year change of +20%. Revenues are expected to be $65.6 million, down 7.3% 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 Strata Critical Medical, Inc., 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 SRTA 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 >>>>

Strata Critical Medical, Inc. is a member of the Zacks Medical Services industry. One other stock in the same industry, SkinHealth Systems Inc. SKIN, finished the last trading session 0.2% higher at $0.66. SKIN has returned 1.6% over the past month.

For SkinHealth Systems Inc., the consensus EPS estimate for the upcoming report has changed +8.3% over the past month to -$0.03. This represents a change of -200% from what the company reported a year ago. SkinHealth Systems Inc. currently has a Zacks Rank of #3 (Hold).

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

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