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Envestnet (ENV) Moves 11% Higher: Will This Strength Last?

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Envestnet (ENV - Free Report) shares soared 11% in the last trading session to close at $79.40. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 1.2% gain over the past four weeks.

The stock recorded this price increase in response to the company’s better-than-expected first-quarter 2021 results. Earnings of 64 cents per share beat the Zacks Consensus Estimate by 4.9%. Revenues of $275.1 million surpassed the consensus mark by 0.6%.

This financial services firm is expected to post quarterly earnings of $0.54 per share in its upcoming report, which represents a year-over-year change of -8.5%. Revenues are expected to be $283.41 million, up 20.4% 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 Envestnet, the consensus EPS estimate for the quarter has been revised 4.8% 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 ENV 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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