The Pennant Group, Inc. (PNTG) shares soared 6.3% in the last trading session to close at $42.48. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 1.5% gain over the past four weeks.
The sharp rise in PNTG shares can be likely due to Pennant's recent acquisition of the real estate of Mainplace Senior Living in Orange, CA, a community its affiliated operator has operated since 2019 under a triple-net lease. The transaction expands the company-owned real estate portfolio and is expected to enhance long-term value creation. The deal aligns with the company's focus on capital deployment in the thriving senior living real estate segment and should strengthen long-term operating stability.
This company is expected to post quarterly earnings of $0.33 per share in its upcoming report, which represents a year-over-year change of +10%. Revenues are expected to be $294 million, up 28.4% 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 The Pennant Group, 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 PNTG 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 >>>>
The Pennant Group is a member of the Zacks Medical - Outpatient and Home Healthcare industry. One other stock in the same industry, RadNet (RDNT), finished the last trading session 1.7% lower at $75.78. RDNT has returned 4.5% over the past month.
For RadNet, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.21. This represents a change of +5% from what the company reported a year ago. RadNet currently has a Zacks Rank of #3 (Hold).
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This article originally published on Zacks Investment Research (zacks.com).