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Strength Seen in Helmerich & Payne (HP): Can Its 12.6% Jump Turn into More Strength?

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Helmerich & Payne (HP - Free Report) shares ended the last trading session 12.6% higher at $32.44. 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 10.6% gain over the past four weeks.

Helmerich & Payne extended its rally for the second straight day, driven by optimism over the OPEC+ cartel’s surprise decision to extend the oil production cuts till the end of April. The stock has also been driven up by an earlier-than-expected pickup in the commodity’s demand on the back of successful deployment of COVID-19 vaccines. The recovery in crude prices to more than $65 a barrel has pushed energy activity higher and contributed to the strength in Helmerich & Payne, which provides drilling services to oil producers.

Price and Consensus

Price Consensus Chart for Helmerich & Payne

This oil and gas well-drilling contractor is expected to post quarterly loss of $0.64 per share in its upcoming report, which represents a year-over-year change of -6300%. Revenues are expected to be $285.57 million, down 54.9% 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 Helmerich & Payne, the consensus EPS estimate for the quarter has been revised 4.5% 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 HP 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 >>>>

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