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American Public Education (APEI) Soars 9%: Is Further Upside Left in the Stock?

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American Public Education (APEI - Free Report) shares soared 9% in the last trading session to close at $30.32. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 10.3% loss over the past four weeks.

The surge in share price came after the company reported impressive fourth-quarter 2020 results, wherein both the top and bottom lines beat the analysts' expectations, and grew year over year. The company also provided encouraging guidance for first-quarter of 2021. It expects revenues to grow by 18% in the quarter. It also anticipates earnings within 39-44 cents per share, indicating growth from 16 cents reported in the year-ago quarter.

This for-profit education company is expected to post quarterly earnings of $0.16 per share in its upcoming report, which represents no change from the year-ago quarter. Revenues are expected to be $86 million, up 15.3% 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 American Public Education, the consensus EPS estimate for the quarter has been revised 20% 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 APEI 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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