Allison Transmission (ALSN) shares rallied 4.2% in the last trading session to close at $117.46. 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 2.9% loss over the past four weeks.
ALSN shares rose yesterday, supported by operational strength and heightened investor optimism around defense growth catalysts, led by a record $250M contract (plus a $50M option) with BAE Systems to supply 4,040 MX transmissions for CV90 MkIV infantry fighting vehicles — the company's largest tracked defense program deal to date.
This automatic transmission maker is expected to post quarterly earnings of $2.55 per share in its upcoming report, which represents a year-over-year change of +11.4%. Revenues are expected to be $1.5 billion, up 84.7% 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 Allison Transmission, 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 ALSN 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 >>>>
Allison Transmission belongs to the Zacks Automotive - Original Equipment industry. Another stock from the same industry, Cooper-Standard (CPS), closed the last trading session 2.4% lower at $26.41. Over the past month, CPS has returned -12.8%.
For Cooper-Standard, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.66. This represents a change of +1000% from what the company reported a year ago. Cooper-Standard currently has a Zacks Rank of #2 (Buy).
7 Best Stocks for the Next 30 Days
Just released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."
Since 1988, the full list has beaten the market more than 2X over with an average gain of +23.9% per year. So be sure to give these hand picked 7 your immediate attention.
See them now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Allison Transmission Holdings, Inc. (ALSN): Free Stock Analysis Report
Cooper-Standard Holdings Inc. (CPS): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).