Spectrum (SPB) Stock Jumps 6.4%: Will It Continue to Soar?

·2 min read

Spectrum Brands SPB shares ended the last trading session 6.4% higher at $62.79. 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 7.8% loss over the past four weeks.

Spectrum Brands' stock rally is an extension of the optimism surrounding its strategic efforts including Global Productivity Improvement Plan (GPIP) and other transformation plans that have been impressing investors. The company has been streamlining its organizational structure and re-energizing employee base to enhance operational efficiencies. It remains focused on transforming the company into a pure-play global Pet and Home & Garden business. Savings from GPIP are expected to be reinvested into the growth initiatives and consumer insights, R&D and marketing across each of the businesses.

This holding company is expected to post quarterly earnings of $0.03 per share in its upcoming report, which represents a year-over-year change of -92.7%. Revenues are expected to be $779.04 million, down 3.6% 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 Spectrum, 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 SPB 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 >>>>

Spectrum is part of the Zacks Consumer Products - Discretionary industry. The RealReal REAL, another stock in the same industry, closed the last trading session 1.7% higher at $1.17. REAL has returned -14.8% in the past month.

The RealReal's consensus EPS estimate for the upcoming report has changed -5.1% over the past month to -$0.42. Compared to the company's year-ago EPS, this represents a change of +10.6%. The RealReal currently boasts a Zacks Rank of #3 (Hold).

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