NGM Biopharmaceuticals shares ended the last trading session 7% higher at $16.20. 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 44.3% loss over the past four weeks.

Last month, the company announced top-line data from the phase IIb ALPINE 2/3 study evaluating aldafermin in patients with non-alcoholic steatohepatitis (“NASH”) with stage 2/3 liver fibrosis. Though the study did not meet its primary endpoint, it did achieve statistical significance versus placebo on certain secondary endpoints, including NASH resolution and multiple non-invasive measures of NASH. This might have been driving the rally.

Price and Consensus

This biotechnology company is expected to post quarterly loss of $0.38 per share in its upcoming report, which represents no change from the year-ago quarter. Revenues are expected to be $22.31 million, up 12.9% 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 NGM Biopharmaceuticals, the consensus EPS estimate for the quarter has been revised 17.4% 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 NGM 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 >>>>