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Strength Seen in CVR (CVI): Can Its 5.2% Jump Turn into More Strength?

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CVR Energy (CVI) shares ended the last trading session 5.2% higher at $34.13. 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 3.4% loss over the past four weeks.

CVR Energy stock ended sharply higher on Friday, driven by optimism over oil prices spurred by curbs on Russia, plus a demand spike owing to the reopening of economies and a rebound in activity. The steady increase in crude prices to over $100 a barrel and robust product demand has lifted the fuel refining space and contributed to the strength in CVR Energy.

This diversified holding company is expected to post quarterly earnings of $1.53 per share in its upcoming report, which represents a year-over-year change of +578.1%. Revenues are expected to be $2.37 billion, up 32.7% 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 CVR, the consensus EPS estimate for the quarter has been revised 10.9% 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 CVI 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 >>>>

CVR belongs to the Zacks Oil and Gas - Refining and Marketing industry. Another stock from the same industry, Tellurian Inc. (TELL), closed the last trading session 1% lower at $2.90. Over the past month, TELL has returned -36.4%.

For Tellurian Inc. , the consensus EPS estimate for the upcoming report has remained unchanged over the past month at -$0.03. This represents a change of +62.5% from what the company reported a year ago. Tellurian Inc. currently has a Zacks Rank of #3 (Hold).


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