U.S. Markets open in 4 hrs 58 mins

Vertex Energy (VTNR) Stock Jumps 95.7%: Will It Continue to Soar?

Vertex Energy (VTNR) shares ended the last trading session 95.7% higher at $7.81. 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 177.1% gain over the past four weeks.

Vertex Energy extended its rally for the third straight day, driven by the transaction to acquire Mobile Chemical Refinery in Mobile, AL from Royal Dutch Shell RDS.A. The deal, signed last week and expected to close in the fourth quarter, will see the Houston-based specialty refiner buy the Mobile facility, associated assets, and the Blakeley Island Terminal, for $75 million in cash plus the value of the inventory. Further, the transformational acquisition, which is expected to significantly increase the company’s future revenues and earnings, prompted Craig-Hallum analyst Eric A. Stine and H.C. Wainwright analyst Amit Dayal to raise their respective price targets on Vertex Energy.

Price and Consensus

Price Consensus Chart for VTNR
Price Consensus Chart for VTNR

This environmental services company is expected to post quarterly loss of $0.03 per share in its upcoming report, which represents a year-over-year change of +88%. Revenues are expected to be $54.42 million, up 154.6% 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 Vertex Energy, the consensus EPS estimate for the quarter has been revised 600% 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 VTNR 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 >>>>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Royal Dutch Shell PLC (RDS.A) : Free Stock Analysis Report

Vertex Energy, Inc (VTNR) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research