Diversified Healthcare (DHC) Surges 5.9%: Is This an Indication of Further Gains?

Diversified Healthcare (DHC) shares rallied 5.9% in the last trading session to close at $8.79. 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 1.4% loss over the past four weeks.

The increased investor optimism in the stock can be attributed to the favorable operating environment.

This residential care real estate investment trust is expected to post quarterly FFO of $0.14 per share in its upcoming report, which represents a year-over-year change of +75%. Revenues are expected to be $383.19 million, up 0.1% from the year-ago quarter.

While FFO and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in FFO estimate revisions and near-term stock price movements.

For Diversified Healthcare, the consensus FFO per share 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 FFO estimate revisions. So, make sure to keep an eye on DHC 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 >>>>

Diversified Healthcare belongs to the Zacks REIT and Equity Trust - Other industry. Another stock from the same industry, Healthpeak (DOC), closed the last trading session 3.7% higher at $20.5. Over the past month, DOC has returned 0.1%.

For Healthpeak, the consensus FFO per share estimate for the upcoming report has remained unchanged over the past month at $0.44. This represents a change of -4.4% from what the company reported a year ago. Healthpeak currently has a Zacks Rank of #3 (Hold).

Zacks' Research Chief Names "Stock Most Likely to Double"

Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.

This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%.

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

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

Zacks Investment Research