Capri Holdings (CPRI) Surges 6.2%: Is This an Indication of Further Gains?

Capri Holdings CPRI shares soared 6.2% in the last trading session to close at $15.19. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 4.6% gain over the past four weeks.

Per media reports, Capri Holdings has attracted potential buyers and allowed some interested parties to review its books, fueling takeover speculation.

This luxury retailer is expected to post quarterly earnings of $0.21 per share in its upcoming report, which represents a year-over-year change of +800%. Revenues are expected to be $780.27 million, down 8.9% 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 Capri Holdings, 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 CPRI 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 >>>>

Capri Holdings is a member of the Zacks Retail - Apparel and Shoes industry. One other stock in the same industry, Deckers DECK, finished the last trading session 0.5% lower at $79.83. DECK has returned -12.9% over the past month.

For Deckers, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $1.82. This represents no change from what the company reported a year ago. Deckers 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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