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Falcon Minerals (FLMN) Surges 5.5%: Is This an Indication of Further Gains?

·2 min read

Falcon Minerals (FLMN) shares ended the last trading session 5.5% higher at $5.57. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 5.2% gain over the past four weeks.

Increased optimism over the accelerated recovery in the energy sector following the massive oil price improvement primarily drove the stock. The price of oil is hovering around $90-per barrel mark, reflecting a massive improvement in the past year. This is beneficial for Falcon Minerals since the company has mineral, royalty, and over-riding royalty interests in the Eagle Ford Shale play.

This company is expected to post quarterly earnings of $0.07 per share in its upcoming report, which represents a year-over-year change of +600%. Revenues are expected to be $20.5 million, up 115.8% 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 Falcon Minerals, the consensus EPS estimate for the quarter has been revised 650% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on FLMN 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 >>>>


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