UBS (UBS) Surges 6.9%: Is This an Indication of Further Gains?
UBS (UBS) shares rallied 6.9% in the last trading session to close at $16.17. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 26.6% loss over the past four weeks.
Bullish investor sentiments surrounding UBS’s prospects likely drove its stock. The company recently filed its annual report, wherein it said that market risk exposure to Russia as of 3 Mar, 2022, was limited. Also, the company’s $$634-million exposure to Russia (as of 2021 end) has been reduced since year end. The company also reiterated financial targets of common equity tier 1 (CET1) capital ratio of 13% and 15-18% return on CET1 capital. Also, a cost/income ratio of 70-73% is expected. Profit before tax in the Global Wealth Management segment is anticipated to grow 10-15%. Such encouraging targets and reduced exposure to Russia have likely propelled its shares.
This bank is expected to post quarterly earnings of $0.57 per share in its upcoming report, which represents a year-over-year change of +16.3%. Revenues are expected to be $9.02 billion, up 22.4% 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 UBS, 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 UBS 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 >>>>
UBS is a member of the Zacks Banks - Foreign industry. One other stock in the same industry, Western New England Bancorp (WNEB), finished the last trading session 1.6% lower at $8.86. WNEB has returned -2.1% over the past month.
For Western New England Bancorp , the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.23. This represents a change of -4.2% from what the company reported a year ago. Western New England Bancorp currently has a Zacks Rank of #1 (Strong Buy).
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