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Genco Shipping (GNK) Moves 5.7% Higher: Will This Strength Last?

·2 min read

Genco Shipping & Trading (GNK) shares soared 5.7% in the last trading session to close at $16.27. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 22% gain over the past four weeks.

The uptick is attributable to the overall optimism surrounding the shipping industry as economic activities gradually gather pace. The northward movement of the Baltic Dry Index – a proxy for global dry freight rates across 23 routes – reflects the optimism surrounding the dry bulk market. In fact shares of the company have performed brilliantly so far this year, gaining 121%.

Price and Consensus

Price Consensus Chart for GNK
Price Consensus Chart for GNK

This transporter of drybulk cargo is expected to post quarterly earnings of $0.72 per share in its upcoming report, which represents a year-over-year change of +267.4%. Revenues are expected to be $75.48 million, up 132.2% 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 Genco Shipping, the consensus EPS estimate for the quarter has been revised 367.4% 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 GNK going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank 1 (Strong Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>


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