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Strength Seen in NeoGenomics (NEO): Can Its 7.9% Jump Turn into More Strength?

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NeoGenomics (NEO) shares ended the last trading session 7.9% higher at $48.23. 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 13.3% loss over the past four weeks.

This marks the third consecutive trading day of NeoGenomics’ price increase driven by the optimism surrounding its agreement to acquire Trapelo Health. The buyout will enable NeoGenomics to substantially boost its capability when it comes to offering customers information to answer complex questions associated with precision oncology biomarker testing and treatment options. The market is also upbeat about NeoGenomics’ recent partnership with Elevation Oncology to enhance the detection of patients having any solid tumor harboring an NRG1 fusion and might be eligible for enrollment in the Phase 2 CRESTONE study.

Price and Consensus

Price Consensus Chart for NEO
Price Consensus Chart for NEO

This operator of cancer-focused testing laboratories is expected to post quarterly earnings of $0.01 per share in its upcoming report, which represents a year-over-year change of +150%. Revenues are expected to be $113.21 million, up 6.8% 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 NeoGenomics, the consensus EPS estimate for the quarter has been revised 200% 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 NEO 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 >>>>


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