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Ducommun (DCO) Stock Jumps 6.7%: Will It Continue to Soar?

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Ducommun (DCO - Free Report) shares ended the last trading session 6.7% higher at $60. 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 1.2% loss over the past four weeks.

Increased optimism among investors surrounding President Joe Biden’s infrastructure plan is likely to have primarily driven the stock higher. Meanwhile, trading in the new space exploration ETF from Ark Invest started on Mar 30, with Lockheed Martin being one of the 39 stocks included in the fund. Interestingly, Ducommun is Lockheed’s subcontractor on the Space Shuttle external tank and a supplier of components for the Space Shuttle, as well as for the International Space Station. So, optimism following the space exploration ETF coming to market might have also boosted Ducommun’s share price.

Price and Consensus

Price Consensus Chart for DCO

This aerospace industry supplier is expected to post quarterly earnings of $0.62 per share in its upcoming report, which represents a year-over-year change of -7.5%. Revenues are expected to be $156.64 million, down 9.7% 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 Ducommun, 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 DCO 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 >>>>

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