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Strength Seen in Sarepta Therapeutics (SRPT): Can Its 8.2% Jump Turn into More Strength?

Sarepta Therapeutics SRPT shares soared 8.2% in the last trading session to close at $92.95. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 14.6% gain over the past four weeks.

Shares were up after the management announced that it intends to file a regulatory application seeking accelerated approval for its gene-therapy candidate, SRP-9001, to treat Duchenne muscular dystrophy (DMD). The company expects to initiate filing later this year. If approved, the treatment could reap billion of dollars in sales for the company.

This biopharmaceutical company is expected to post quarterly loss of $1.07 per share in its upcoming report, which represents a year-over-year change of -4.9%. Revenues are expected to be $220.08 million, up 34.1% 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 Sarepta Therapeutics, the consensus EPS estimate for the quarter has been revised 2.1% 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 SRPT 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 >>>>

Sarepta Therapeutics is part of the Zacks Medical - Biomedical and Genetics industry. Vertex Pharmaceuticals VRTX, another stock in the same industry, closed the last trading session 0.2% lower at $280.41. VRTX has returned -0.3% in the past month.

Vertex's consensus EPS estimate for the upcoming report has changed -1.2% over the past month to $3.48. Compared to the company's year-ago EPS, this represents a change of +11.9%. Vertex currently boasts a Zacks Rank of #3 (Hold).


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