Strength Seen in Shockwave Medical (SWAV): Can Its 4.5% Jump Turn into More Strength?

Shockwave Medical (SWAV – Free Report) shares soared 4.5% in the last trading session to close at $176.70. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock’s 5.4% loss over the past four weeks.

ShockWave Medical witnessed solid price appreciation following a possibility of a merger or partnership with another healthcare company. However, it is important to mention here that ShockWave Medical’s discussions are still ongoing and it cannot be said with certainty about a transaction taking place in future.

This medical device compnay is expected to post quarterly earnings of $0.07 per share in its upcoming report, which represents a year-over-year change of +115.2%. Revenues are expected to be $75.46 million, up 232.1% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For Shockwave Medical, 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 SWAV 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 >>>>