Regal Beloit (RBC Quick QuoteRBC - Free Report) shares rallied 3.6% in the last trading session to close at $148.82. 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 12% gain over the past four weeks.

Regal Beloit’s rally is largely driven by optimism over the company’s agreement with Rexnord Corporation to combine operations with the latter’s Process & Motion Control (PMC) segment. Notably, the deal will combine Regal Beloit and Rexnord PMC segment’s advanced power transmission portfolios. This is likely to boost Regal Beloit’s product line and enhance its position as a major provider of power transmission solutions, apart from strengthening its market presence and shareholder value.

Price and Consensus

This maker of controls for electric motors is expected to post quarterly earnings of $1.67 per share in its upcoming report, which represents a year-over-year change of +27.5%. Revenues are expected to be $776.96 million, up 5.8% 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 Regal Beloit, the consensus EPS estimate for the quarter has been revised 7.8% 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 RBC going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank 2 (Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>