Forum Energy (FET) Moves 6.4% Higher: Will This Strength Last?

Zacks Equity Research
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Forum Energy Technologies (FET) shares rallied 6.4% in the last trading session to close at $20.50. 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 1.9% loss over the past four weeks.

Forum Energy Technologies stock rose for the second straight day, driven by optimism over rising oil and natural gas prices. The increased commodity prices are likely to push drilling activities higher in the domestic market. This will, in turn, boost demand for the Houston, TX-based oilfield equipment provider’s services. Also, its diverse revenue sources from multiple industries are a major positive.

This provider of manufactured technologies and applied products in the energy sector is expected to post quarterly loss of $1.33 per share in its upcoming report, which represents a year-over-year change of +77.8%. Revenues are expected to be $150 million, up 44.8% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For Forum Energy, the consensus EPS estimate for the quarter has been revised 2.9% 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 FET 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 >>>>


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