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Phreesia (PHR) Surges 7%: Is This an Indication of Further Gains?

Phreesia (PHR) shares soared 7% in the last trading session to close at $14.68. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 52.3% loss over the past four weeks.

Phreesia recorded a strong price rise on investors’ optimism surrounding its impending fiscal first-quarter 2023 financial results, which is slated to release on June 02 post the closing bell. For the fiscal first quarter, the Zacks Consensus Estimate for the company’s revenue is pegged at $62.43 million, suggesting a surge of 29.3% year over year. Moreover, the market is also upbeat about Phreesia recent collaboration with Azalea Health intended to offer a robust integration between their systems to enhance the overall intake experience. This integration will allow provider organizations to offer patients a seamless, convenient digital experience more efficiently, with the staff they have.

This developer of health care software is expected to post quarterly loss of $1.09 per share in its upcoming report, which represents a year-over-year change of -354.2%. Revenues are expected to be $62.43 million, up 29.3% 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 Phreesia, the consensus EPS estimate for the quarter has been revised 0.6% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on PHR 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 >>>>

Phreesia is part of the Zacks Medical Info Systems industry. Nextgen Healthcare (NXGN), another stock in the same industry, closed the last trading session 1.9% higher at $19.01. NXGN has returned -14.1% in the past month.

Nextgen Healthcare's consensus EPS estimate for the upcoming report has changed -2.8% over the past month to $0.20. Compared to the company's year-ago EPS, this represents a change of -4.8%. Nextgen Healthcare currently boasts a Zacks Rank of #4 (Sell).

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