Avita Medical Inc. (RCEL) shares ended the last trading session 14.1% higher at $5.6. 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 6.3% gain over the past four weeks.
AVITA Medical’s stock rallied after the company announced positive interim data from its Cohealyx-I study, which demonstrated a reduction of nearly 20 days in mean time to skin grafting for patients with full-thickness wounds. The results demonstrated strong statistical superiority compared to a literature-derived benchmark, based on the lower bound of the 95% confidence interval. Additionally, the company has entered into a 10-year agreement with the Biomedical Advanced Research and Development Authority (BARDA), under which RCEL will maintain an inventory of RECELL products available for immediate deployment upon notice from BARDA and support surge procurement of additional product, ensuring scalable emergency response capacity.
This company is expected to post quarterly loss of $0.35 per share in its upcoming report, which represents a year-over-year change of +34%. Revenues are expected to be $17.69 million, down 4.4% 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 Avita Medical, 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 RCEL 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 >>>>
Avita Medical is part of the Zacks Medical - Drugs industry. Surrozen, Inc. (SRZN), another stock in the same industry, closed the last trading session 6.7% higher at $31.85. SRZN has returned 17.1% in the past month.
Surrozen's consensus EPS estimate for the upcoming report has changed -4% over the past month to -$1.39. Compared to the company's year-ago EPS, this represents a change of +55.6%. Surrozen currently boasts a Zacks Rank of #3 (Hold).
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Avita Medical Inc. (RCEL): Free Stock Analysis Report
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This article originally published on Zacks Investment Research (zacks.com).