AdaptHealth Corp. (AHCO) shares rallied 10.7% in the last trading session to close at $11.48. 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 0.8% gain over the past four weeks.
The sharp rise in AHCO shares can be attributed to a strong vote of confidence from its leadership, as Chief Executive Officer Richard Cashin made a substantial insider purchase. Over March 19 and 20, Cashin acquired nearly 447,827 shares at an average price of $9.91, representing a total investment of about $4.44 million and increasing his total holdings to 16.3 million shares. This significant buy signals management’s confidence in the company’s future prospects, boosting investor sentiment and reinforcing the belief that the stock may be undervalued at current levels.
This company is expected to post break-even quarterly earnings per share in its upcoming report, which represents a year-over-year change of -100%. Revenues are expected to be $798.14 million, up 2.6% 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 AdaptHealth, the consensus EPS estimate for the quarter has been revised 350% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on AHCO 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 >>>>
AdaptHealth belongs to the Zacks Medical - Products industry. Another stock from the same industry, AtriCure (ATRC), closed the last trading session 0.6% lower at $29.61. Over the past month, ATRC has returned -6.3%.
AtriCure's consensus EPS estimate for the upcoming report has remained unchanged over the past month at -$0.07. Compared to the company's year-ago EPS, this represents a change of +50%. AtriCure currently boasts a Zacks Rank of #3 (Hold).
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This article originally published on Zacks Investment Research (zacks.com).