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Park National (PRK) shares soared 3.9% in the last trading session to close at $121.93. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 2.2% loss over the past four weeks.
The performance of banks is expected to have improved in the second quarter driven by the higher interest rates and rise in demand for commercial loans. Investors are also bullish on the sector on expectations of the interest rate hikes this year. This possibly led to the optimistic stance by the investors, which drove Park National higher.
This financial services holding company is expected to post quarterly earnings of $2.03 per share in its upcoming report, which represents a year-over-year change of -17.8%. Revenues are expected to be $110.5 million, down 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 Park National, 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 PRK 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 >>>>
Park National is part of the Zacks Banks - Midwest industry. Lakeland Financial (LKFN), another stock in the same industry, closed the last trading session 2.8% higher at $67.70. LKFN has returned -8.9% in the past month.
Lakeland Financial's consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.95. Compared to the company's year-ago EPS, this represents no change. Lakeland Financial currently boasts a Zacks Rank of #2 (Buy).
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