Strength Seen in PagSeguro Digital Ltd. (PAGS): Can Its 6.1% Jump Turn into More Strength?
PagSeguro Digital Ltd. (PAGS) shares soared 6.1% in the last trading session to close at $37.29. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 36.9% loss over the past four weeks.
The company's stock witnessed a surge after it announced its preliminary third-quarter results. The financial transaction services provider expects to deliver purchase volume worth $22.59 billion in the to-be reported quarter, indicating an upside of 85% from the year-ago quarter's reported figure. It also anticipates exiting the third quarter with 12.2 million active users.
Analysts remain positive about this stock as it is well-poised for growth in the long run on the back of its solid fundamentals.
This company is expected to post quarterly earnings of $0.42 per share in its upcoming report, which represents a year-over-year change of +121.1%. Revenues are expected to be $487.55 million, up 47.1% 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 PagSeguro Digital Ltd., the consensus EPS estimate for the quarter has been revised 5.6% 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 PAGS 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 >>>>
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