PRA Health Sciences shares soared 3.8% in the last trading session to close at $161.80. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 7% gain over the past four weeks.
PRA Health witnessed strong price appreciation driven by optimism surrounding its selloff deal to ICON plc. The deal consideration represents around 30% premium to PRA Health’s closing price as of Feb 23 (the date of announcement). Investor sentiment got further boost with ICON plc winning U.S. antitrust approval for the planned buyout on Apr 15. Care Innovations, a PRA Health company, getting selected by Maryland State Medical Society (to offer remote patient monitoring, telehealth and digital health services to a network of above 22,000 licensed physicians practicing across more than 50 medical specialties) also contributed to the share appreciation.
Price and Consensus
This contract research organization is expected to post quarterly earnings of $1.35 per share in its upcoming report, which represents a year-over-year change of +28.6%. Revenues are expected to be $854.93 million, up 9.1% 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 PRA Health Sciences, the consensus EPS estimate for the quarter has been revised 1.2% 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 PRAH 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 >>>>